The Panama Papers: an expose of how dark money flows through the global financial system by Consortium of Investigative Journalists (ICIJ) 8:52pm 5th Apr, 2016   October 2016    Tax income lost by countries to fund public services total hundreds of billions of dollars each year. (UN News)    Governments must eliminate tax haven secrecy and offshore tax evasion, United Nations human rights experts said today, following the revelation of large-scale misuse of offshore accounts by financial service providers and wealthy individuals in the Bahamas.    The UN Independent Expert on foreign debt and human rights, Juan Pablo Bohoslavsky, and two members of the Human Rights Council Advisory Committee, Obiora Okafor and Jean Ziegler, urged governments to act in concert and establish a United Nations body working to eliminate tax haven secrecy and offshore tax avoidance and evasion.    “While offshore structures can reflect legitimate business activity, individuals are estimated to hold between US$7 and US$25 trillion of wealth offshore, and the tax income lost by many countries could total hundreds of billions of dollars each year.    When individuals and corporations hide unreported assets abroad to escape taxes or launder money, they are effectively stealing from the public.    The proceeds from these illicit activities could and should be devoted to funding public services, such as health care, housing, schools, transportation infrastructure, social security, law enforcement and courts.    We need to recall that illicit financial flows include funds that, through legal loopholes and other artificial arrangements, circumvent the spirit of the law, including, for example, tax avoidance schemes facilitated by the use of offshore corporations.    Thanks to the work of investigative journalists, the taxpaying public is now aware of these immoral and illegal strategies, and understands how tax abuse undermines economic, social and cultural rights. States must prove they take seriously the interest of billions of people all around the world who suffer from the erosion of public services owing to massive fiscal misconduct.    It is time for the United Nations to take efficient measures to prevent illegal activities of offshore companies located in tax havens. Worldwide tax justice and the successful fight against money laundering will not be possible unless states cooperate to monitor and regulate the fiscal activities of offshore companies.    Transparency and accountability for offshore financial activity needs to be established. States must set uniform minimum taxation floors, to prevent individuals and business entities from shopping for the lowest possible tax rates.    Public disclosure of beneficial ownership information must be made legally binding in all countries, and the financial transparency of all banking jurisdictions should be ranked in an annual public report by independent experts appointed by the United Nations. This ranking should be based on a transparent set of criteria.    States and financial institutions should be required to automatically share information with foreign taxation authorities for the purpose of detecting offshore taxable income. In this way, the secrecy and anonymity that enshrouds illicit offshore financial activity can be lifted, and money intended to promote shared prosperity can be returned to its rightful owners: the public.    * See the Independent Expert’s study on illicit financial flows: http://bit.ly/2dWjsdw    Sep 2016    Shortfalls in tax revenues handicaps Governments in meeting human rights treaty obligations, by Alfred-Maurice de Zayas.    (The United Nations Secretary-General has the honour to transmit to the UN General Assembly the fifth report of the Independent Expert on the promotion of a democratic and equitable international order, Alfred-Maurice de Zayas, submitted in accordance with Assembly resolution 70/149. Seventy-first session of the United Nations General Assembly).    This report focuses on the impacts of taxation on human rights and explores the challenges posed to the international order by widespread tax avoidance, tax evasion, tax fraud and profit shifting, facilitated by bank secrecy and a web of shell companies registered in tax havens.    The Independent Expert calls for resolute action by the international community, including through the creation of a United Nations tax cooperation body, the adoption of a United Nations tax convention, the phasing out of tax havens, the revision of the Guiding Principles on Business and Human Rights to include the obligation of corporations to pay their fair share of taxes and the adoption of a financial transactions tax.    The current international economic order manifests ever growing inequalities among States and within States. Whereas the United Nations should determine the world agenda, the economic order is not set by the United Nations General Assembly but by major economic powers, by transnational corporations and by three international organizations - the World Trade Organization, the World Bank and the International Monetary Fund (IMF) -none of which have been incorporated into the United Nations system.    It is time to harmonize the policies of these three organizations with the purposes and principles of the Organization and to ensure that their actions do not frustrate the implementation of United Nations programmes.    There are systemic obstacles to changing this situation, among them asymmetrical power relationships; unfair taxation; lack of transparency and accountability; unjust enrichment; widespread corruption; bribery; embezzlement; secrecy; collusion among lobbies, accounting and consulting firms and law firms; and vested interests of domestic and transnational corporations. These should be met by stricter implementation of domestic and international penal law.    This has a detrimental impact on human rights as it deprives States of resources needed to fulfil their human rights treaty obligations concerning the administration of justice, maintenance of infrastructures, health care, education and housing, and prevents them from implementing pledges for the Sustainable Development Goals and for environmental protection pursuant to the Paris Agreement.    The Independent Expert recognizes that a democratic and equitable international order cannot be achieved without adequate funding. A human rights-based approach to taxation and stricter measures against tax fraud, tax evasion and tax havens are urgently needed because a shortfall in tax revenues handicaps Governments in meeting human rights treaty obligations.    * See the Independent Expert’s report: http://bit.ly/2eFeHs1    April 2016    The Panama Papers: an expose of how dark money flows through the global financial system, reports the Consortium of Investigative Journalists (ICIJ).    A new investigation published by ICIJ, the German newspaper Süddeutsche Zeitung and more than 100 other news organizations around the globe, reveals the offshore financial links of some of the planet’s most prominent people.    In terms of size, the Panama Papers is likely the biggest leak of inside information in history – more than 11.5 million documents – and it is equally likely to be one of the most explosive in the nature of its revelations.    The leak exposes the offshore holdings of 12 current and former world leaders, including relatives of Syria"s President Bashar al-Assad, friends of Russian President Vladimir Putin and members of China"s Communist Party elite; twenty-nine Forbes-listed billionaires are also named in the leak.    The files contain new details about major scandals ranging from England’s most infamous gold heist, an unfolding political money laundering affair in Brazil and bribery allegations convulsing FIFA, the body that rules international soccer.    They also provide details of the hidden financial dealings of 128 other politicians and public officials around the world and show how a global industry of law firms and big banks sells financial secrecy to fraudsters and drug traffickers as well as billionaires, celebrities and sports stars.    The Panama Papers expose offshore companies controlled by the prime ministers of Iceland and Pakistan, the king of Saudi Arabia and the children of the president of Azerbaijan. They also include the names of at least 33 people and companies blacklisted by the U.S. government because of evidence that they’ve done business with Mexican drug lords, terrorist organizations or rogue nations, including North Korea and Iran.    The leaked data covers nearly 40 years, from the late 1970s through the end of 2015. It allows a never-before-seen view inside the offshore world – providing a day-to-day, decade-by-decade look at how dark money flows through the global financial system, breeding crime and stripping national treasuries of tax revenues.    The leaked records – which were reviewed by a team of more than 370 journalists from nearly 80 countries – come from a little-known but powerful law firm based in Panama, Mossack Fonseca, that has branches in London, Beijing, Miami, Zurich and more than 35 other places around the globe.    The firm is one of the world’s top creators of shell companies, corporate structures that can be used to hide ownership of assets. The law firm’s leaked internal files contain information on 214,000 offshore companies connected to people in 200 countries and territories.    The data include emails, financial spreadsheets, passports and corporate records revealing the secret owners of bank accounts and companies in 21 offshore jurisdictions, from Nevada to Hong Kong to the British Virgin Islands.    It is the largest cross-border media collaboration ever undertaken. Journalists working in more than 25 languages dug into Mossack Fonseca’s inner affairs and traced the secret dealings of the law firm’s customers around the world. They shared information and hunted down leads generated by the leaked files using corporate filings, property records, financial disclosures, court documents and interviews with money laudering experts and law-enforcement officials.    Most of the services the offshore industry provides can be used for legal purpose and are by law-abiding customers. But the documents show that banks, law firms and other offshore players often fail to follow legal requirements to make sure clients are not involved in criminal enterprises, tax dodging or political corruption. The files show that these fixers and middlemen protect themselves and their clients by concealing suspect transactions. In some instances, they work to head off official investigations by backdating and destroying documents.    The Panama Papers make it clear that major banks are big drivers behind the creation of hard-to-trace companies in the British Virgin Islands, Panama and other offshore havens. The files list more than 15,600 paper companies that banks set up for clients who wanted to keep their finances under wraps, including hundreds created by international giants UBS and HSBC.    Using complex shell company structures and trust accounts Mossack Fonseca services allow its clients to operate behind an often impenetrable wall of secrecy.    Mossack Fonseca"s success relies on a global network of accountants and prestigious banks that hire the law firm to manage the finances of their wealthy clients. Banks are the big drivers behind the creation of hard-to-trace companies in tax havens.    Mossack Fonseca registers companies in tax havens on an industrial scale. Many companies exist on paper only with no office and no employees. One of the big selling points is anonymity. Clients can pay Mossack Fonseca extra to provide front people known as nominees so they can act as shareholders, directors or even the owners of companies.    "This is always a really good opportunity to launder money. This is, they are doing really huge transactions from one country to another and they are hiding it and masking it in a way, so you really can"t follow the money," German investigative journalist Bastian Obermayer says.    Mossack Fonseca has registered more than 200,000 companies, trusts and foundations in secretive jurisdictions around the world, roughly half in the British Virgin Islands and the rest split between countries including Panama, the Seychelles, the Bahamas and Samoa.    The international standard governing shell companies, set by the inter-governmental Financial Action Task Force (FATF), is clear-cut. It says countries should take all necessary measures to prevent their misuse, such as ensuring that accurate information on the beneficial owner is available to "competent authorities".    The leaked documents reveal that as one tax haven becomes more compliant with international rules, Mossack Fonseca simply starts incorporating companies in new jurisdictions with fewer disclosure requirements.    Shell companies are considered a perfect vehicle for moving large sums of money across international borders without a trace.    Tax havens are firmly entrenched in the global financial system, according to the Tax Justice Network, they account for 50 per cent of all world trade.    The tax haven system is considered a major driver of income inequality. James Henry from the Tax Justice Network said tax havens are a global network of secrecy jurisdiction where the world"s wealthiest people exploit the system to avoid paying tax.    "There"s at least $21 trillion to $32 trillion of individual private financial wealth offshore, parked through havens," he said.    According to the OECD, recent economic growth has disproportionately benefited higher income groups while lower income households have been left behind.    * Access the report via the link: http://panamapapers.icij.org/    April 2016    Transparency International calls for immediate action by world leaders to stop secret companies.    A global investigation into the use of secret companies by the rich, powerful and corrupt has shown how a network of lawyers, bankers and others around the world hide illicit wealth. Transparency International calls on the international community to act immediately to adopt transparency laws to outlaw secret companies.    The Panama Papers, a massive leak of financial documents, reveal the offshore holdings of 140 politicians and public officials, including 12 current and former world leaders, who used more than 214,000 offshore entities to hide the ownership of assets.    “The Panama Papers investigation unmasks the dark side of the global financial system where banks, lawyers and financial professionals enable secret companies to hide illicit corrupt money. This must stop. World leaders must come together and ban the secret companies that fuel grand corruption and allow the corrupt to benefit from ill-gotten wealth,” said José Ugaz, the chair of Transparency International.    Transparency International is calling for a renewed push for G20 countries to agree that public beneficial ownership registers should be the global standard, and sanctions applied to jurisdictions that do not conform to this standard. This would include not just the G20, but also the numerous countries big and small where the creation of secret companies is big business.    “How many more massive document leaks do world leaders need to see to understand that the lack of public registers of beneficial owners of companies is what keeps global grand corruption schemes alive and well?” Ugaz said.    Transparency International wants public registers of all companies beneficial owners to make it harder for the corrupt to hide their illicit wealth in secret companies and trusts that use nominees to register ownership. The G20 have supported measures to increase beneficial ownership transparency, but have done little to implement them.    “As more information is revealed about how a network of financial middlemen, lawyers, accountants and big banks facilitate both the movement of illicit wealth and the way to disguise who actually owns it, it is clear what has to be done. Enablers who help companies set up secret companies must be sanctioned and jurisdictions that welcome secrecy, must be outlawed,” said Elena Panfilova, vice-chair of Transparency International.    Transparency International has named the U.S. state of Delaware, home to thousands of anonymous shell companies thanks to its strict corporate secrecy rules, as part of its Unmask the Corrupt campaign (Unmaskthecorrupt.org) specifically because its corporate registration rules help people hide the true owners of companies.    http://blog.transparency.org/2016/03/31/giving-people-a-voice-lessons-from-measuring-corruption/ http://www.actionaid.org/news/tax-treaties-stopping-poor-countries-collecting-fair-share-tax-multinationals http://www.one.org/scandal/en/report/ http://blog.transparency.org/2016/03/24/why-open-data-can-stop-corruption/ http://financialtransparency.org/    Tax havens don’t need to be reformed. They should be outlawed, writes Richard Brooks for The Guardian.    The Panama Papers are not really about a central American state. They are a glimpse through a Panamanian keyhole of an orgy of tax evasion, money laundering and kleptocracy – amid the legitimate financial planning – hosted by the world’s tax havens. Seven years after world leaders came together at a post-financial crisis G20 summit in London and committed to end tax haven abuse, it is clear from these papers that no such end is in sight.    The good intentions have translated into a blizzard of international agreements on sharing information, amnesties through which tax evaders can come clean, and prosecution drives of variable quality to nail the cheats. All are demonstrably inadequate. Information will not, and cannot, be exchanged to any meaningful extent by countries and territories whose “offer” is that they don’t ask for it or will turn a blind eye to being deceived.    Amnesties teach rich tax evaders that, even if they are caught, they will get off far more lightly than somebody overclaiming a few pounds in social security benefits. Criminal pursuit of offenders, certainly in the UK, is little more than a joke. One prosecution from 1,000 tax evaders using HSBC’s Swiss accounts is the now infamously poor punchline.    Here, the Panama Papers lay bare another national disgrace: Britain’s longstanding role at the centre of the offshore web. More than half of the 200,000 secret companies set up by the Panama lawyers Mossack Fonseca were registered in the British Virgin Islands, where details of company ownership don’t have to be filed with the authorities, never mind be made public.    While this week’s leak is on an unprecedented scale, it exposes a historic as well as current failing. As the British empire faded away after the second world war and territories such as the British Virgin Islands drifted into the constitutional limbo of semi-independence, they were encouraged to develop financial services as a way of sustaining precarious economies. If this meant a few of the world’s wealthier people paid a little less tax, thought successive British governments, it was a price worth paying for not having to support the territories.    Late 20th-century financial liberalisation turned this already complacent calculation into something more lethal. With fortunes sloshing freely across borders, tax havens became voracious parasites on the world economy, most seriously sucking the life out of some of its poorer parts. All the great national robbers of recent decades, such as Nigeria’s Sani Abacha, have used tax haven companies, including British Virgin Islands ones, as the getaway cars.    Despite this long trail of evidence, leading economies refuse to address the problem at its source. The UK has great leverage over its 17 overseas territories and crown dependencies, all of which depend on the mother country for security and happily trade off its legal system. At a stroke our government could shut down the British Virgin Islands corporate system, for example.    But under influence from a banking system that thrives on the legal benefits of offshore centres such as the British Virgin Islands and the Cayman Islands, it takes a more relaxed view. Asked recently about whether Britain’s overseas territories should publish registers of beneficial owners of their companies, foreign office minister James Duddridge replied that these were a “direction, rather than an ultimate destination”. The Panama Papers should expose this indifference for the great scandal that it is.    Without leaks like this week’s, nothing would be publicly known about the tax haven companies now exposed. And next to nothing would be known by the authorities in the countries affected. Yet, alongside dozens of other tax havens, the British Virgin Islands can claim to be on the Organisation of Economic Cooperation and Development’s “white list” of approved jurisdictions, having met conditions imposed for exchanging information.    That’s right: a major centre of international financial crime, home to the shell companies and any number of other money launderers and sanctions-busters, is endorsed by the rich nations’ club.    With around $1tn a year still flowing out of developing countries to tax havens, it is clear that coaxing these territories into increased transparency can achieve only marginal gains. The recent series of leaks poses a more potent threat: anybody contemplating hiding income offshore must now factor in the risk that many years later the details could make their way from an office such as Mossack Fonseca’s into the wider world. Far better, even the greediest might think, simply to pay the tax and get on with life.    But for others, especially those looting serious money, the offshore attractions will remain. There will be further added layers of secrecy: phoney foundations and fake beneficial owners with no names mentioned even in internal emails. A small proportion of scams will be exposed in the press and documentaries featuring telegenic palm trees and yachts will continue to hit our TV screens. But the tax havens will keep their place in the world.    To tackle the cancer of corruption at the heart of the global financial system, tax havens need not just to reform but to end. Companies, trusts and other structures constituted in this shadow world must be refused access to the real one, so they can no longer steal money and wash it back in. No bank accounts, no property ownership, no access to legal systems. The anti-corruption summit being hosted by David Cameron in May is an opportunity to start the international team effort that this would require. The world has been entertained by tax havens long enough.    * Richard Brooks is a former tax inspector who was consulted by Panorama and the Guardian over the Panama papers.    http://www.theguardian.com/news/series/panama-papers http://www.theguardian.com/news/commentisfree/2016/apr/04/tax-havens-reformed-outlawed-panama-papers http://www.bbc.com/news/world-35934836    The enablers of financial secrecy know what they are doing. (Tax Justice Network)    Law firms like Mossack Fonseca know exactly what they are doing when they set up secret offshore companies. Lawyers operate in a privileged environment. Although they have a duty of confidentiality to their clients, that duty does not override their obligation to uphold the law. This means performing adequate due diligence on their clients and informing the relevant authorities when they come across suspicious activity.    However, far too many offshore lawyers, accountants and bankers see it as their role to shield their clients from financial regulations designed to prevent money laundering, tax evasion and corruption.    The Tax Justice Network has for many years highlighted the role Panama has played in the global offshore industry. Our Financial Secrecy Index, the benchmark for assessing the secrecy of financial centres, assigns Panama with one of the highest secrecy scores in the world.    The kind of financial secrecy practised by Panama is designed specifically to avoid global regulations requiring the disclosure of assets. In many cases this secrecy is established for the sole purpose of hiding criminal or corrupt transactions.    For years we have called on governments around the world to implement the policies required to stamp out tax evasion, corruption and criminality, yet we have seen little progress.    We note that today’s latest leak from the ICIJ highlights yet again how financial secrecy permeates the global political and business elite; many of whom are responsible for designing the rules on the global economy.    What is needed now is a commitment to end financial secrecy, tax havens and the offshore financial system. We are unaware of any legitimate reason as to why individuals need to incorporate companies in secrecy jurisdictions. It is now time for that practice to end.    Commenting specifically on the latest allegations, John Christensen, Director of the Tax Justice Network said:    “Mossack Fonseca has been one of the giants of the offshore world for decades. They had a reputation for extreme secrecy and discretion on their clients’ behalf, which needless to say was attractive to many clients engaged in tax evasion, fraud, hiding conflicts of interest, and other white collar crimes.    It is important to recognise that offshore law firms like Mossack Fonseca do not operate in isolation; they rely on intermediaries, often other law firms or banks, to pass on clients and to provide support for the sophisticated cross-border structures needed by politically exposed clients or other members of the global financial elite who want to hide their corrupt and criminal activities”    Alex Cobham, Director of Research for the TJN said: “The Tax Justice Network’s Financial Secrecy Index has for a long time listed Panama as one of the most secretive jurisdictions in the world. In the most recent index we identified Panama as a jurisdiction of ‘extreme concern’. But the international community, despite talking a good game, has done little to compel improvements either from Panama or the many other jurisdictions working to promote secrecy, including the British tax haven network.    This global inaction has allowed places like Panama to cause huge damage to the global economy, facilitating tax avoidance and evasion that not only eliminates government revenues to the tune of hundreds of billions of dollars a year, but also the corruption that undermines democratic government and elite accountability.”    Nicholas Shaxson, author of Treasure Islands, a book about tax havens, said:    “While the focus is currently on Panama, one of the world’s sleaziest tax havens, it is important not to forget that it is just part of a bigger global system. The United States is a big player in the game, hosting vast sums in foreign-owned assets in conditions of strong secrecy. The United Kingdom runs a global network of Overseas Territories and Crown Dependencies that includes some of the world’s biggest tax havens — including Cayman, the British Virgin Islands, Bermuda and Jersey.    In a little over two months’ time UK Prime Minister David Cameron will hold a global anti-corruption summit in London. If the UK government is serious about taking on corruption and money laundering, then it needs to take action on the British territories, many of which are used by companies such as Mossack Fonseca to hide their clients’ wealth.”    http://www.taxjustice.net/2016/04/04/15473/ http://www.taxjustice.net/    The Panama Papers Expose the Hidden Wealth of the World’s Super-Rich, by Chuck Collins.    As global wealth concentrates in fewer hands, the world’s wealthy are shifting trillions to offshore havens to escape taxation, accountability, and publicity.    The just-released Panama Papers—filled with titillating details involving the shady dealings of world leaders and violent traffickers of drugs and slaves—should give a strong boost to US and global campaigns to crack down on these global secrecy jurisdictions and practices.    Starting with an anonymous leak to the German newspaper Süddeutsche Zeitung and shared with a consortium of journalists, the Panama Papers initially identify 140 politicians and public officials using off-shore schemes.    Leaders named with offshore wealth include current and former members of China’s politburo, three members of the UK House of Lords, the president of Ukraine, and the prime ministers of Iceland and Pakistan. Others include movie star Jackie Chan, Argentinian soccer star Lionel Messi, and 29 billionaires from the Forbes global wealth list.    Initial media coverage in US major dailies is scant, perhaps due to the conspicuous absence of US citizens named in what The Guardian calls the “first tranche” of disclosures. But as more findings are revealed over the coming months, it’s hard to imagine that prominent American names won’t be on the lists.    Russian president Vladimir Putin’s close associates are heavily implicated. Kremlin spokesman Dmitry Peskov was quick to counter-attack, arguing that the motive behind the leak was political, not journalistic. “Putin, Russia, our country, our stability and the upcoming elections are the main target, specifically to destabilize the situation.” Peskov charged that former CIA and US State Department had even helped analyze the documents.    The papers implicate Iceland’s Prime Minister Sigmundur David Gunnlaugsson as secretly owning millions in bank bonds during the 2008 collapse of Iceland’s banking system. He is facing calls for his resignation.    The unprecedented year-long journalistic effort involved more than 370 reporters from 100 media organizations, coordinated by the International Consortium of Investigative Journalists (ICIJ). The primary sources were leaks from Mossack Fonseca, Panamanian law firm with more than 35 offices around the world. Journalists sifted through transactions involving 214,488 off-shore corporations covering 40 years of activity.    Gabriel Zucman, author of The Hidden Wealth of Nations: The Scourge of Tax Havens and assistant professor at UC Berkeley, estimates that $7.6 trillion in individual assets are in tax havens, about 8 percent of the world’s financial wealth. He believes the use of tax havens has grown 25 percent from 2009 to 2015. Zucman estimates that US citizens have at least $1.2 trillion stashed offshore, costing $200 billion a year worldwide in lost tax revenue from wealthy individuals. US multinational corporations underpay their taxes worldwide by $130 billion by engaging in corporate tax avoidance.    The Panama Papers reveal the widespread use of shell corporations in the British Virgin Islands, the Seychelles in the Indian Ocean, and Panama. Historically, North American investors prefer tax havens in the Caribbean or Panama, with an estimated 54 percent of offshore investments going to those areas. Other popular tax dodging destinations were Switzerland, Ireland, and the Channel Islands, off the coast of England.    Transnational corporations also have an estimated $2 trillion in assets hidden in offshore tax havens or stashed in subsidiary corporations in countries with minimal or no corporate taxation.    While the use of offshore systems are not always illegal, they are often abused to dodge taxation, launder funds from criminal activity, and allow public officials to conceal assets from publicity and scrutiny. As the Süddeutsche Zeitung wrote, a “look through the Panama Papers very quickly reveals that concealing the identities of the true company owners was the primary aim in the vast majority of cases.”    This publicity will hopefully bolster the global movement against tax haven abuse, including the work of US networks such as Americans for Tax Fairness and the Financial Accountability and Corporate Transparency (FACT). The FACT Coalition has been advocating for transparency reforms such as disclosure of “beneficial ownership” of shell corporations and entities. It is pressing for passage of “The Incorporation Transparency and Law Enforcement Assistance Act” (H.R. 4450 and S. 2489) that would require all American companies, with a number of exceptions, to disclose the real people who own or control them when they are formed, and to keep that information updated.    FACT Coalition member Global Witness urges US-based activists to consider the considerable leverage we have in this country to change this system. The United States itself is a major tax haven, one of the easiest places to set up an anonymous shell company to move ill-gotten gains around the world.    And abuses of the offshore system are increasingly convenient. For $2,500, an individual can now purchase the “Complete Offshore Package” that includes an offshore corporation in Belize, an offshore trust in the Bahamas, and offshore Bank account at the Global Bank of Commerce in Antigua, and mail forwarding for one year. After the set-up, this will only cost $1,000 a year.    Systematically confronting offshore tax havens will require legislative action, international diplomacy, and sanctions and penalties aimed at both banks and tax-haven jurisdictions. Nations must establish treaties requiring uniform disclosure and transparency, both of banks and capital flows. The United States has enormous responsibility and leverage in fixing this broken system.    The Panama Papers are a boost to the global movement to stop tax-haven abuse and recapture trillions of the hidden wealth of nations. This story isn’t going away anytime soon.    http://www.thenation.com/article/panama-papers-expose-the-hidden-wealth-of-the-worlds-super-rich/ http://equitablegrowth.org/live-gabriel-zucman-presents-the-hidden-wealth-of-nations/ http://www.globalshellgames.com/media.html http://www.corporateknights.com/channels/leadership/going-offshore-14592311/ http://ctj.org/pdf/offshoreshell2015.pdf http://www.gfintegrity.org/press-release/massive-leak-secret-documents-panamanian-firm-reveal-movement-billions-dollars-suspect-transactions/ http://www.publicintegrity.org/2016/04/03/19503/massive-leak-reveals-offshore-accounts-world-leaders http://www.access-info.org/company-register-transparency http://www.abc.net.au/4corners/stories/2016/04/04/4434529.htm http://www.democracynow.org/2016/4/5/panama_papers_world_leaders_rich_criminals http://billmoyers.com/story/the-panama-papers-what-theyre-all-about-2/ http://www.pbs.org/newshour/tag/panama-papers/ http://www.abc.net.au/radionational/programs/latenightlive/panama-shell-games/7300660 http://fcpamap.com/ http://www.globalintegrity.org/blog/ www.globalwitness.org/en-gb/press-releases/new-global-register-shine-light-anonymous-companies-root-cause-corrupt-illegal-activities/    * April 2016    After ‘Panama Papers’ leak, UN expert calls for end of financial secrecy to halt illicit fund flows, Independent Expert on foreign debt and human rights, Juan Pablo Bohoslavsky.    In the wake of last week’s leak of a trove of confidential financial documents from a Panama law firm, a United Nations human rights expert called on the international community to urgently put an end to financial secrecy.    “Tax evasion and the flow of funds of illicit origin undermine justice and deprive Governments of resources needed for the realization of economic, social and cultural rights,” UN Independent Expert on foreign debt and human rights, Juan Pablo Bohoslavsky, warned, as the documents, which have been dubbed the ‘Panama Papers,’ have shown how corporations, wealthy individuals and politically exposed persons have systematically hidden assets in more than 21 offshore jurisdictions.    “The clients may have had different motives for depositing their assets into more than 210,000 secret shell companies. But tax evasion, hiding corruption and criminal funds appear to be a prominent reason,” said Mr. Bohoslavsky, author of a recent study on illicit financial flows presented to the UN Human Rights Council.    The expert noted that shell companies have also been used in the past by groups and individuals busting sanctions, trafficking drugs, engaging in illicit arms trade, terrorism as well as by authoritarian rulers responsible for severe violations of human rights.    “Tax evasion destroys trust in public institutions and the rule of law, and shrinks the fiscal space for investing in public health care, education, social security and other public goods and services,” the expert explained. “Public funds that are essential to guarantee economic, social and cultural rights to all are robbed from the people,” he added.    The UN human rights office noted that the leaked documentation shows that many banks and financial intermediaries have failed to exercise due diligence with their clients. Some of them may actually have aided and abetted tax evasion, corruption and other criminal activities. According to the ‘Panama Papers’ more than 14,000 banks, law firms, company incorporators or other middlemen have set up companies, foundations and trusts for customers.    Mr. Bohoslavsky recalled that the UN Human Rights Council recognized that flows of funds of illicit origin deprive many States of resources required to progressively realize human rights. In a resolution adopted last month, the Council stressed the need for transparency and effective due diligence procedures of financial intermediaries.    Reducing substantially by 2030 illicit financial flows is an agreed target of the new UN Sustainable Development Goals (SDGs). Curbing such flows was also agreed to at the Third International Conference on Financing for Development held in July 2015 in Addis Ababa.    “States need now to take action to honour these commitments,” the expert said. “The ‘Panama Papers’ underscore the need to make public disclosure of beneficial ownership information legally binding in all countries. States must put an end to such harmful banking secrecy, for which there is no meaningful justification.”    Mr. Bohoslavsky urged moving towards a global system of automatic exchange of tax information which ensures that developing countries can benefit from it on an equal footing. “Financial institutions and intermediaries facilitating tax evasion, corruption or other criminal activities must be also held to account,” he said.    According to estimates by the Washington based think tank Global Financial Integrity, illicit financial outflows from developing and emerging economies related to tax evasion, crime, corruption and other illicit activities amounted to $1.1 trillion in 2013. This is a significant drain of resources which increased during the last decade on an average rate of 6.5 per cent per year.    http://www.un.org/apps/news/story.asp?NewsID=53639#.Vwg0RUd1BhE http://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=19800&LangID=E    March 2016    Economic inequality and financial crises undermine human rights, by Juan Pablo Bohoslavsky.    Economic inequality contributes to financial crises and can undermine human rights, said the United Nations Independent Expert on foreign debt and human rights, Juan Pablo Bohoslavsky, presenting his latest report to the UN Human Rights Council.    “Inequality can erode the State’s tax base and increase private debt which affects sovereign debt and can undermine stability and lead to financial crises. Conversely the social effect of financial crises can be catastrophic for the poor,” the human rights expert said.    There has been an unprecedented accumulation of wealth in recent years by a small but powerful elite: the 80 richest individuals are estimated to own as much wealth as the bottom 50% of the entire world’s population. Global inequality is extremely high and still rising.    “Austerity measures adopted in response to financial crises have pushed many individuals below minimum income levels,” Mr. Bohoslavsky said, “and international human rights law has something to say about economic inequality”. His report is clear that States have the obligation to prevent inequality undermining the enjoyment of human rights.    “While human rights law does not necessarily imply a perfectly equal distribution of income and wealth, it does require conditions in which rights can be fully exercised. As a consequence, a certain level of redistribution is expected in order to guarantee individuals an equal enjoyment of the realization of their basic rights,” the expert noted.    In his report, Mr. Bohoslavsky offered a range of recommendations to tackle inequalities in the prevention of financial crises and in response to them. These include: financial market regulation, minimum wages, progressive taxation and social protection floors.    “Structural adjustment programmes should be subjected to robust human rights impact assessments and not only orientated at short term fiscal targets to regain debt sustainability,” he concluded.    Next to his report on inequality, the Independent Expert presented his final study on illicit financial flows, in which he focuses on the tax-related flows: tax evasion by high net-worth individuals, commercial tax evasion through trade misinvoicing and tax avoidance by transnational corporations.    In the study, Mr. Bohoslavsky argues that curbing illicit financial flows and tax abuse is essential not only for realizing human rights, but also for achieving the Sustainable Development Goals.    http://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=17227&LangID=E    The dramatic increase in levels of inequality, by Professor Philip Alston, Special Rapporteur on extreme poverty and human rights.    (Statement by the Special Rapporteur on extreme poverty and human rights at the 29th session of the Human Rights Council)    Perhaps the biggest societal change to take place in recent decades has been the dramatic increase in levels of inequality, not just between the rich and the poor, but between the super-rich and the rest.    It is cause for shame that the wealth of the world’s eighty richest people is roughly the same as that of the poorest 3.5 billion people. At the same time, the lowest 40% in terms of income distribution have benefited little, and in many cases have gone backwards. This is the world that our existing policy choices have created, and these trends are continuing to increase dramatically.    The resulting extreme inequality has been denounced by most of the major international economic policy organizations, although it is in many respects their consistent policy prescriptions over past decades that have facilitated precisely these outcomes. But now, in a rather surprising development, the IMF, the World Bank and the OECD, among others, are warning of dire consequences if the trend is not halted.    The question for this Council is where human rights fit into the equation. The answer to date has been resoundingly clear: human rights have so far had almost no place in this debate.    On the part of the international economic institutions, concerns are now being expressed about the fraying of the social fabric, the weakening of trust in institutions, the threat to justice, macroeconomic instability, suboptimal use of human resources, and even the risks of capture of the economic and political systems.    But such statements rarely ever mention human rights specifically and when surrogate references are made to concerns such as those I just mentioned, it is to point to the potential negative consequences of extreme inequality for economic growth. Their analyses never lead to the suggestion that greater respect for human rights might be a crucial part of the solution.    What then can this Council do? First, we need to recognize that the concern is not solely with income inequality, but with a range of extreme inequalities in relation to wealth, access to education, health care, housing and so on.    Second, our response should be motivated not only by these deep threats to economic, social and cultural rights, but also by the fact that the enjoyment of the full range of civil and political rights is undermined by extreme inequality.    Third, while a great many steps will need to be taken if extreme inequality is to be halted, the Council needs to do more than just adopt fine words. For over 25 years, independent experts have been submitting reports warning of the consequences of inequality, but nothing has been done in response.    If concern about extreme inequality is to be transformed into human rights policies, action will be required on a broad range of fronts.    In my comments today, however, I want to focus on just one particular way in which fundamental change can be achieved. The most tangible way of affirming that we have a normative commitment to limiting the consequences of extreme inequality is to guarantee a minimum level of respect for economic and social rights for every person. In brief, these fundamental rights need to be taken seriously at the national and international levels.    They need to be treated as human rights, they need to be integrally linked to the provision of Social Protection Floors and universal healthcare coverage, and they need to be protected by appropriate institutional arrangements applying a human rights framework to monitor and provide redress.    Some will respond to this suggestion that a great many states already have such arrangements in place, but in fact this is not really the case. I am under no illusion that this step alone will tame rampant inequality, but it is one of the few tangible steps that human rights proponents can take which will have a guaranteed impact on the overall situation.    We need to ask what this Council and its various stakeholders and partners have achieved over the years to change the reality on the ground in terms of genuine acceptance by governments, manifested in legislation and explicit policies, of the importance of economic and social rights in general, and universal social protection in particular.    I suspect that the scientific answer is rather little, although it has to be said that it is not for want of trying. There is a huge gap between the rhetorical embrace of economic and social rights in this Council and elsewhere and the reality on the ground. As stakeholders in the Council we all need to ask ourselves why such a gap persists and what we can do about it.    The starting point is to acknowledge that there has been great progress in the past two or three decades in taking economic and social rights seriously, at least in terms of the United Nations’ internal institutional indicators. The Committee on Economic, Social and Cultural Rights was created in 1987, Special Procedures mandates on economic, social and cultural rights were created, an Optional Protocol was adopted, and the “indivisibility, interdependence and inter-relatedness” of the two sets of rights have repeatedly been reaffirmed. Vast numbers of reports have been generated, resolutions adopted, and speeches delivered.    But it is instructive to move beyond the situation in these halls and look at what has been happening in the outside world. It would be revealing to undertake a systematic stocktaking of the real status of economic and social rights as human rights at the national level, but that is an exercise which must wait for another day.    What I want to focus on now is the extent to which contexts which we would assume would have seen the embrace of economic and social rights, continue to resist them. The World Bank takes the position that, because its Articles of Agreement prohibit it from taking account of political considerations, human rights can play no part in its work. It thus steadfastly refuses to use the language of economic and social rights and to go far out of its way to avoid, for example, references to the right to education or the human rights of women. The IMF, for all of its enlightened concern about the consequences of inequality is every bit as resistant as the Bank to taking any account of human rights in its work.    These organizations see themselves as essentially human rights-free zones. The OECD also has a long history of aversion to the language and framework of human rights.    Then there is an exercise of the utmost importance that is much closer to home: the drafting of the post-2015 sustainable development goals. In previous drafts, human rights were almost entirely absent. The latest draft is a significant step forward, but it is noteworthy that not a single one of the 17 goals is expressed in explicit human rights terms and that no single right, apart from the right to development, is acknowledged in the entire draft. Those relating to poverty elimination, food security, well-being for all, education, and gender equality, could all have been expressed, at least in part, in human rights terms, but Member States rejected all such proposals.    This is not the whole story, of course, since the ILO has made a huge breakthrough in premising its work on Social Protection Floors on the right to social security and related social rights, and the WHO is beginning to make more systematic use of the right to health in terms of its work on universal healthcare coverage.    But the simple point I want to make is that in the work of the leading international organizations focusing on poverty elimination, development, economic growth, and sustainability, recognition of the importance of both sets of human rights is either marginalized or entirely absent. Leaving aside civil and political rights for just a moment, one would have assumed that the language and framework of economic and social rights would be relatively uncontroversial and readily acceptable in contexts in which they are clearly of central and direct relevance. But this has not been the case.    We can, of course, blame the relevant institutions for their short-sightedness, but some of the fault must surely lie also with us. The Governments that make the decisions in those other contexts are represented here. What can be done?    In the report that I am presenting today I call on the Council to recognize explicitly that there are limits to the levels of inequality that can be considered to be compatible with respect for human rights. I call for it to encourage States to make formal commitments to reducing extreme inequality. I urge the implementation of fiscal policies aimed specifically at reducing inequality. I call for human rights bodies generally to give new life to aspects of the commitment to equality in human rights law. And I urge both inter-governmental bodies and non-governmental organizations to put questions of resources and redistribution back into the human rights equation, in which they are currently ignored or marginalized.    http://www.ohchr.org/EN/Issues/Poverty/Pages/SRExtremePovertyIndex.aspx http://www.ohchr.org/EN/Issues/Poverty/Pages/Fiscalandtaxpolicy2014.aspx http://www.ohchr.org/EN/Issues/Poverty/Pages/AnnualReports.aspx http://www.ohchr.org/EN/Issues/Poverty/Pages/IssuesInFocus.aspx    Jan. 2016    The World"s Inequality Countdown, by Winnie Byanyima. (Oxfam International, agencies)    In 2010, some 388 people owned as much wealth as the poorest half of the world"s population. Jump to 2014 and that 388 is down to 85 people. In 2015 the figure was 80 and now today Oxfam has revealed that 62 rich individuals own as much wealth as the poorest 3.6 billion people.    If this deeply alarming inequality clock continues to tick as fast, by 2020 a mere 11 people could have the same wealth as half the world. That"s not even a dozen.    This extreme inequality is not a sign of a healthy global economy as all the wealth is being sucked up by those at the dizzying top. Trickle-down economics is a fallacy - this is not just Oxfam"s view but that of the World Bank also. The rich can no longer pretend their wealth benefits the rest of us. It doesn"t: it harms us. The only thing that"s "trickling down" is inequality, and powerlessness.    The consequences of this extreme economic inequality are far reaching. If inequality is not dealt with, we could see more social unrest across the world, a brake on growth and all the work that has been done in the last quarter century on poverty halted - potentially reversed.    What this means to you and me is a more unstable, unequal world with fewer people able to escape poverty.    In 2014, the richest 10 percent of people in Latin America had amassed 71 percent of the region’s wealth. If this trend continues, according to Oxfam"s calculations, in only six years the region"s richest 1 percent will have more wealth than the 99 percent.    Meanwhile, inequality in Asia has risen by as much as 18 percent since the mid-1990s. Had this rise not happened, 240 million people across Asia could have escaped poverty.    In Africa, four million children"s lives could be saved each year if 30 percent of Africa"s wealth was not held in tax havens. This means at least $14bn is lost in tax revenues each year, a sum that could pay for life-saving healthcare for African mothers and children, and employ enough teachers to get every African child into school.    Across the world, Oxfam is seeing devastating impacts on the people we work with. But it doesn"t have to be this way. Inequality is not inevitable.    In 2015, we saw the Sustainable Development Goals on extreme poverty and inequality enshrined. We also saw G20 governments agreeing on measures to curb tax dodging by multinational companies, but these reforms don"t go far enough in ensuring governments receive the taxes they are due. So more does need to happen, especially as tax havens are becoming an ever more common way of doing business.    It is estimated that tax dodging by multinational corporations across the world costs developing countries at least $100bn every year. Corporate investment in tax havens almost quadrupled between 2000 and 2014.    Tax may be boring to some, but the figures are eye watering. Roughly $7.6 trillion of individuals wealth sits offshore. If tax were paid on the incomes this wealth generates, we are looking at an extra $190bn for governments to spend on services that are essential for a functioning society, such as schools and hospitals.    We need to end the era of tax havens if we are to stop the inequality countdown. For the benefit of all of us, our governments - that are meant to represent our interests - need to shun the vested interests of the richest by stopping the race to the bottom on tax and pulling back the curtains on shady financial dealings.    http://www.oxfam.org/en/pressroom/pressreleases/2016-01-18/62-people-own-same-half-world-reveals-oxfam-davos-report http://www.oxfam.org/en/research/economy-1 http://www.oxfam.org/en/tags/corporate-tax-dodging http://www.oxfam.org/en/tags/tax-reform http://www.oxfam.org/en/tags/inequality http://www.oxfam.org/en/tags/poverty http://www.actionaid.org/2016/02/power-poverty-gender-and-injustice-local-impact-inequality http://www.actionaid.org/tags/429/5544 http://www.actionaid.org/tags/429/1587    * Sustainable Development Goals target risk missing the mark on inequality, by Kate Donald.(Center for Economic & Social Rights)    This March, the UN Statistical Commission convenes for its annual meeting in New York. At the top of its agenda will be the latest report of the Inter-Agency and Expert Group on Sustainable Development Goal Indicators (IAEG-SDGs), which presents a final proposal for global indicators to monitor the SDGs. In the run-up to the Commission, various civil society groups have expressed their concern about particular indicators or missing indicators, as well as the opaque decision-making process.    The Center for Economic and Social Rights (CESR) is particularly concerned that SDG 10 (‘Reduce inequality within and between countries’) does not include a robust measure of economic inequality, and as such this indicator set is woefully incomplete.    Economic inequality is a particularly pervasive and cross-cutting form of inequality that is a pressing issue in all countries, negatively impacting human rights enjoyment as well as poverty reduction and growth.    Moreover, good methodologies to measure economic inequality already exist, which can easily be applied globally.    In general, the indicators for SDG10 that touch on income focus solely on the bottom end of the spectrum, thereby neglecting to consider high earners and the top wealth brackets. Including the top end of the distribution is essential when assessing overall economic inequality (given that inequality is by definition relative, and the accumulation of wealth and income at the top has direct impacts on the situation of those at the bottom).    CESR and other civil society agencies proposed a specific indicator that would have captured these concerns and measured the full distributive impacts of fiscal policy: the Palma ratio measured pre-tax and post-social transfers.    Unfortunately, although a similar indicator did feature in previous IAEG proposals, neither this eminently measurable indicator nor the more widely-used Gini coefficient were included in the final draft. This leaves Goal 10 without a badly-needed economic inequality indicator and failing to address a crucial aspect of Target 10.4 ‘Adopt policies, especially fiscal, wage and social protection policies, and progressively achieve greater equality’.    These shortfalls make it more likely this target will be overlooked by policy-makers. One of the most important and hard-won elements of Target 10.4 is its explicit recognition of fiscal policy as a determinant of inequality, but the sole indicator agreed focuses on wages and social protection transfers (and moreover lumps them together in a way which dims the indicator’s power).    Given the growing evidence of how fiscal policies can affect human rights, we feel this is a lamentable omission from the IAEG, distorting and unbalancing the target and the goal itself.    The final Agenda 2030 agreement Transforming Our World states that “inclusive and sustainable economic growth…will only be possible if wealth is shared and income inequality is addressed”.    If the implementation of Agenda 2030 is to meet this essential condition, it will be necessary to incentivize the right policy actions with relevant indicators. It is to be hoped that national-level indicator sets can correct this glaring gap in the global list.    http://www.cesr.org/article.php?id=1822 http://cesr.org/article.php?id=1622 http://www.cesr.org/article.php?id=1726 http://cesr.org/article.php?list=type&type=157    http://business-humanrights.org/en/tax-avoidance-0 http://www.ibanet.org/Human_Rights_Institute/TaskForce_IllicitFinancialFlows_Poverty_HumanRights.aspx http://academicsstand.org/blog/2016/01/27/global-justice-post-2015-conference-videos/ http://academicsstand.org/2014/06/press-release-un-goals-should-do-more-to-curb-tax-dodging-that-has-cost-poor-countries-trillions/ http://academicsstand.org/2014/09/experts-thousands-from-around-the-world-call-on-ban-to-put-an-end-to-tax-abuse/ http://academicsstand.org/2014/09/policy-options-for-addressing-illicit-financial-flows-results-from-a-delphi-study/ http://resourcecentre.savethechildren.se/library/tackling-tax-and-saving-lives-children-tax-and-financing-development http://www.rightingfinance.org/?p=1535 http://www.rightingfinance.org/?p=977 http://www.opendemocracy.net/openglobalrights/audrey-gaughran/cracking-down-on-tax-abuse-will-help-promote-economic-and-social-ri http://www.opendemocracy.net/openglobalrights/economic-inequality-and-human-rights    http://www.ibanet.org/PresidentialTaskForceFinancialCrisis2013Report.aspx http://www.world-psi.org/en/billions-disappearing-through-tax-evasion http://www.gfintegrity.org/need-clear-sdg-target-illicit-financial-flows/ http://www.trust.org/item/20140226151645-jbwui/ http://www.socialwatch.org/node/16451    http://www.theguardian.com/global-development/2015/sep/21/top-incomes-drive-income-inequality-global-target http://www.un.org/esa/desa/papers/2015/wp143_2015.pdf http://hdr.undp.org/sites/default/files/equity_inequality_human_development_in_post-2015_framework.pdf http://post2015.files.wordpress.com/2013/03/inequality-letter-final-190313.pdf http://www.ethicsandinternationalaffairs.org/2014/eliminating-extreme-inequality-a-sustainable-development-goal-2015-2030/ http://oxfamblogs.org/fp2p/its-the-share-of-the-rich-stupid-brilliant-inequality-stats-politics-from-gabriel-palma/    * Why a Global Wealth Tax would help address Inequality, by Thomas Piketty.    The issue of inequality is one of the most salient in global politics. Thomas Piketty, Professor of Economics at the Paris School of Economics writes on the economic forces which have impacted upon inequality. He argues that with disparities in income and wealth rising substantially over recent decades, a global progressive tax on individual net worth would offer the best option for keeping inequality under control.    http://www.social-europe.eu/2014/04/global-wealth-tax/ http://www.nybooks.com/articles/archives/2014/may/08/thomas-piketty-new-gilded-age/ http://www.social-europe.eu/2014/04/joe-stiglitz-paul-krugman-capital-twenty-first-century/ http://ourfuture.org/20140415/thomas-piketty-wealth-inequality-corrupts-our-politics http://billmoyers.com/episode/what-the-1-dont-want-you-to-know-2/ http://billmoyers.com/2014/05/30/the-head-of-the-imf-says-inequality-threatens-democracy-here-are-7-charts-proving-shes-right/ http://www.hup.harvard.edu/catalog.php?isbn=9780674430006 http://www.huffingtonpost.com.au/entry/watch-elizabeth-warren_n_5434250.htm http://www.eurozine.com/articles/2014-07-02-piketty-en.html http://blog.transparency.org/2014/08/25/piketty-diagnosing-inequality-and-prescribing-a-dose-of-anti-corruption/ http://www.taxjustice.net/2014/04/25/pikettys-inequality-numbers-understated/ Visit the related web page
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