Massive data leak exposes offshore financial secrets
They sought the utmost secrecy in offshore tax havens. But now some of the world’s wealthiest citizens are having their undisclosed financial records laid bare.
An unprecedented leak of documents is revealing the closely guarded investment information of more than 100,000 people around the world, including hundreds of Canadians.
In what is believed to be one of the largest ever leaks of financial data, the Washington, D.C.-based International Consortium of Investigative Journalists has received nearly 30 years of data entries, emails and other confidential details from 10 offshore havens around the world.
CBC News has partnered with the ICIJ over the last seven months to gain exclusive Canadian access to the information. Thirty-seven media outlets in 35 other countries are also involved.
“This secret world has finally been revealed,” said lawyer and international tax expert Art Cockfield, a professor at Queen’s University in Kingston, Ont.
“I find it absolutely fascinating to get a look at this data dump. I think this is the very first time where people like myself, and maybe even government officials, have had access to this information.”
The files contain information on over 120,000 offshore entities — including shell corporations and legal structures known as trusts — involving people in over 170 countries. The leak amounts to 260 gigabytes of data, or 162 times larger than the U.S. State Department cables published by WikiLeaks in 2010.
“What we found as we started digging in the records is a pretty extensive collection of dodgy characters: Wall Street fraudsters, Ponzi schemers, figures connected to organized crime, to arms dealing, money launderers,” said Michael Hudson, a senior editor at the ICIJ, who worked with a team for months to sort through the information.
The leaked data also contains revelations about:
- Elite Russian scammers who stole $230 million from the country’s treasury in a deadly heist that sparked a diplomatic row with the U.S.
- The fraudster hit with the second-biggest fine in history from Ontario’s stock-market regulator.
- Top German, French and Swiss banks that set up thousands of secretive companies in offshore havens for such clients as Thai and Pakistani politicians.
In many cases, the leaked documents expose insider details of how agents would incorporate companies in Caribbean and South Pacific micro-states on behalf of wealthy clients, then assign front people called “nominees” to serve, on paper, as directors and shareholders for the corporations — disguising the companies’ true owners.
Often the companies were set up through intermediary law and accounting firms, as well, adding a further layer of anonymity for investors.
Offshore tax havens have existed for at least 100 years. While there’s no firm definition, the International Monetary Fund says most of what it officially calls “offshore financial centres” are distinguished by:
- A banking sector that primarily serves non-residents.
- Low to no taxation on foreign firms and people.
- Tight financial secrecy.
By those terms, there are up to 80 tax havens in the world, including such countries as Panama, Liechtenstein and Switzerland but also tiny island territories like Jersey, Malaysia’s Labuan, the Isle of Man and the Turks and Caicos.
Worldwide, the Tax Justice Network estimates that between $21 trillion and $32 trillion of private wealth is held offshore, out of reach of national treasuries (a more conservative estimate by the Boston Consulting Group puts the figure at $8 trillion). The international organization says that translates to up to $280 billion a year in lost taxes — twice what the world’s richest countries spend combined on foreign aid.
“”This secret world has finally been revealed,”
you really think so?
do you really think the big boys didnt know this was coming?
data leaks?..isnt that what assange is accused of? but these leaks are ok if they fit an agenda?
“a pretty extensive collection of dodgy characters: Wall Street fraudsters, Ponzi schemers, figures connected to organized crime, to arms dealing, money launderers,”
i dont see any names or evidence..thats ususally what you show when you get data..