You’ve probably already heard about this sensational story, which dominates the news cycles everywhere in the world. The Pandora Papers refers to a leak of financial documents. These documents show how various political figures, businessmen and celebrities use offshore companies to hide their assets.
Déjà vu
This new leak is sending shockwaves around the world, but it’s hardly surprising. We all know that wealthy people would always try and find legal loopholes to protect their assets. Not only that, but we’ve already been through this before. Does anyone remember the Panama Papers?
The 2016 scandal involved 11.5 million leaked files from the Panama firm Mossack Fonseca. A man known as John Doe (identity concealed) who worked at the firm was responsible for the leak. He said he did it to make a point about income inequality.
Despite the media frenzy around the case, nothing really came out of it. Yes, there is an international arrest warrant issued to the founders of the firm, namely Jürgen Mossack (German national) and Ramón Fonseca (Panamanian national), but that’s about it.
Nothing happened to the people mentioned in the papers (except maybe for Hillary Clinton, whose popularity decreased right before the 2016 election), and we predict the same would happen to the individuals mentioned in the Pandora Papers.
Honourable mentions: Offshore Leaks (2013), Paradise Papers (2017)
Opening Pandora’s Box
The Pandora Papers leaked on 3 October 2021 and immediately captured everyone’s attention. The leaks represent 2.94 TB of data or 11.9 million files from 14 different sources.
More than 600 journalists from different countries have been tasked with examining the files. This is the biggest journalistic collaboration so far. The journalists have been working on the papers for the past few months, with stories only released this week.
The name, Pandora Papers, doesn’t refer to a country or company, but was instead picked for poetic reasons. Just like the mythological Pandora opened the box and released all the evils in the world, the leaks are meant to shed light on the elites’ corrupt practices.
Where do the Leaks Come From
The Pandora Papers are by far the largest leak of offshore data in history. Rather than coming from a single firm or country, the Pandora Papers encompass multiple countries and companies. These countries include:
- Anguilla
- Belize
- Panama
- Barbados
- The Bahamas
- The British Virgin Islands
- Switzerland
- Cyprus
- Dubai
- Seychelles
- Singapore
- Vietnam
It is not yet clear who leaked the information to the International Consortium of Investigative Journalists (ICIJ) and they are refusing to name the source.
What’s the Issue
The Pandora Papers show how powerful and wealthy individuals are using offshore accounts, usually in an attempt to pay less taxes in their native countries. It should be noted that this is not in itself illegal. However, some people are concerned with the morality of using offshore accounts to hide one’s true wealth.
Of course, the governments are the ones that are genuinely interested in this matter. It’s thought that tax havens cost governments around the world approximately $400-$800 billion in lost tax revenue every year. Considering the economic impact that the Covid-19 pandemic has had on every country, money is more than needed right now.
Moreover, not all operations are (fully) legal. While having an offshore account is perfectly fine, tax fraud, money laundering, and other criminal activities aren’t. We expect the team of journalists to reveal more information regarding crimes that might have been committed in the following weeks.
Naming the Names
We bet you want to know who are the ‘stars’ of the Pandora Papers. There are hundreds of public officials (including 35 current or former heads of state), businessmen, and celebrities who make up the leaks, so we decided to bring you the ones gathering the most controversy.
King Abdullah II
Abdullah II, King of Jordan, is amongst the most talked-about individuals named by the Pandora investigation. He has bought 15 homes abroad since he assumed power in 1999. These include properties in the US and the UK. King Abdullah’s lawyer argue he used his personal wealth, but critics are not sold.
The King used offshore accounts to purchase the properties amounting to over $95 million. Abdullah II is thought to secretly head many offshore companies that he uses to make such purchases. Apparently, people employed by him don’t even refer to him by name and use the phrase ‘you know who’.
The Aliyev Family
The Aliyev family is a powerful Azerbaijani political dynasty that has long been accused of corruption. The head of the family, Ilham Aliyev, is the current president of Azerbaijan, having served this role for more than 18 years.
The Pandora Papers exposed the family’s secret real estate empire. They are the owners of 17 properties in the UK with the price tag of $700 million. The purchases were mostly made in cash through offshore companies. Curiously, one of the properties, an apartment block in London, was owned by Aliyev’s 11-year-old son.
Vladimir Putin
Vladimir Putin was also implicated in the Pandora Papers scandal, albeit passively. Svetlana Krivonogikh was named as the owner of a posh Monaco flat she acquired through an offshore company in the British Virgin Islands. She’s also the owner of a few luxury estates in her native Russia. She’s also likely Putin’s girlfriend.
Krivonogikh has amassed considerable wealth in the past two decades and many people think that Putin used his influence (and money) to help her. She also allegedly has a daughter with him, but both mother and daughter refuse to answer questions about Putin.
The journalists working on the Pandora Papers believe that Putin used his friends and associates to set up a network in the tax haven of Monaco.
Tony Blair
Tony Blair acquired a property in Marylebone, London, in 2017 by buying the offshore company that owned the property. This way Blair didn’t have to pay stamp duty, which would have amounted to £312,000. Although this action is not illegal per se, Blair has been very critical of tax loopholes when he was the British Prime Minister.