Biggest Information Leak in History

So, as of June 14th, the list is now publicly accessible.  We have seen children and other family members of ex-Dictators, gun runners, ex-Ministers and other politicians, military generals, actors, jailed fraudsters, business people already under investigation, bankers with famous last names etc on this list.   On this list we find Imee Marcos, daughter of the former Philippine president Ferdinand Edralin Marcos so Philippine authorities are investigating if the money is part of the $5 billion which Marcos allegedly stole from the country in the 1980s.  On the list are family members of Azerbaijani President Ilham Aliyev, Prime Minister of Georgia Bidzina Ivanishvili, the wife of former Russian First Vice Premier Igor Shuvalov – Olga, Deputy Director of the Board of Gazprom Valeriy Golubev and Ukrainian oligarchs Rinat Akhmetov and Dmytro Firtash.

There are supposed to be about 1000 ‘British names’.  Thinking about my favorite Caribbean island of Trinidad, I note that the list includes someone from Spanish Court, Westmoorings, someone from Freeport as well as Mr C.R. who just gives his address as Trinidad.  I am not going to name anyone because, despite what the mainstream media says, having an offshore structure does not mean one is guilty of any crime.  But those who are guilty of anything must be feeling pretty nervous these days given the spate of ‘leaks’ and whistleblowers popping up.

What is this list I’m talking about?  Of course I’m talking about what some describe as the biggest information leak in history known in the mainstream media as “Offshore Leaks”.  This is the leak of 2.5 million emails and other documents, mainly from the offshore haven of the British Virgin Islands (BVI), which has already caused a seismic shock worldwide in the world of offshore finance.  A space which a former chief economist at McKinsey estimated may have as much as $32tn (£21tn) stashed in overseas havens.

There are conflicting accounts on how or when this list was leaked to tax authorities in the US, the UK and Australia.  Personally, I have reason to believe that the information had been leaked years ago but it was in the hands of some key institutions who were figuring out how to deal with it.  Regardless, to put it in context, the Wikileaks files from Bradley Manning were supposed to be about 2 gigs but Offshore Leaks were over 200 gigs of information covering about 3 decades of financial information about the global transactions of BVI private incorporation agencies. It also includes data on their offshoots in Singapore, the Cayman Islands, Hong Kong and the Cook Islands in the Pacific all up to 2010.

The entity behind the new online searchable database for Offshore Leaks is called the International Consortium of Investigative Journalists (ICIJ).  The app for the website was developed by La Nación newspaper in Costa Rica for ICIJ, and it displays graphic visualizations of offshore entities and the networks around them, including, when possible, the company’s true owners. 

Perhaps this is part of the reason for PM Cameron’s enthusiasm for greater transparency.  He wants to counteract the negative PR this brings to certain British dependencies.  I do believe however, that the more likely motive is to pressure Anglo-American ‘persons’ to bring their money ‘home’ and re-inject them into the ‘onshore’ Anglo-American financial system.  I’ll try to explain why by referencing 5 ideas.

  1. Idea number 1 is that the US dollar is not backed by anything physical but it is backed by debt originating from the issuance of bonds. 
  2. Idea number 2 is that oil is largely traded in US dollars thanks to an agreement between OPEC and the US which is often referred to as the petrodollar system. 
  3. Idea number 3 is that the petrodollar system plus the fact that the dollar is still the world’s reserve currency creates the demand for the dollar. 
  4. Idea number 4 is that the value of the dollar is at least partly determined by demand for the dollar by most countries to settle international transactions.
  5. Idea number 5 is that the US dollar is in danger.  A February 14th 2013 CNBC article notes that according to the International Monetary Fund, the dollar has drifted to a 15-year low and is shrinking as a percentage of the world's currency supply, raising concerns that the greenback is about to see its long run as the world's premier denomination come to an end.  While more countries are willing to use other currencies to do business, the American currency still reigns supreme.  It constitutes $3.72 trillion, or 62 percent, of the $6 trillion in allocated foreign exchange holdings by the world's central banks.  BUT, the Japanese yen, Swiss franc and what the IMF classifies as "other currencies" such as the Chinese Yuan are gaining. US Expat Singapore

If these 5 points are valid, then there is good reason for the Western financial system to start tightening the loopholes that were previously tolerated if not actively encouraged.

Read more on DerrenJoseph.blogspot.com

Comments

Popular posts from this blog

Perpetual Nomad? Is it possible to pay taxes nowhere?

6 Steps to Starting Your Location Independent Business

Converting an LLC to an S Corp

Navigating the Post-Wayfair World

Taxation of Digital Products