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Paradise Papers: Here’s what we know about the leaks so far

A cache of 13.4 million leaked documents from Bermuda-based firm Appleby have shown a spotlight on offshore entities.

world Updated: Nov 06, 2017 14:50 IST
HT Correspondent
HT Correspondent
Hindustan Times
Paradise Papers,Paradiese Papers expose,Appleby
The Paradise Papers is the latest in a series of offshore leaks and follows the 2016 Panama Papers leak.(Getty Images/iStockphoto)

The world woke up on Monday to the Paradise Papers, the latest in a series of leaks that uncovered the scale of offshore companies and how the world’s elite hides their money in tax havens.

The International Consortium of Investigative Journalists (ICIJ) made public 13.4 million leaked documents which mainly originate from a Bermuda-based firm Appleby that provides offshore legal services to the world’s wealthiest.

Here are 8 things to know about the Paradise Papers:

What do the leaked documents reveal?

The 13.4 million leaked documents reveal the offshore footprints of some of the world’s biggest corporates as well as individuals. Companies such as Adidas, Nike, Facebook, Havells, Sun Group, among others, have been named.

Setting up offshore companies or parking funds in tax havens is not illegal. But what the Paradise Papers reveal is the extent of how companies such as Appleby help big corporations exploit loopholes to evade taxes.

What is the significance of these leaks?

While offshore tax havens are legal, questions have been raised over how vast and complicated the network has become. The secrecy around the offshore empire often attracts “money launderers, drug traffickers, kleptocrats and others who want to operate in the shadows,” the ICIJ report says.

Second, the lack of transparency hampers scrutiny. “Paradise Papers open the door for regulatory bodies to investigate and ascertain the legitimacy of these offshore transactions,” says the Indian Express.

Third, the offshore industry makes “the poor poorer” and is “deepening wealth inequality,” Brooke Harrington, a certified wealth manager and Copenhagen Business School professor, told ICIJ. “There is this small group of people who are not equally subject to the laws as the rest of us, and that’s on purpose,” Harrington said. These people “live the dream” of enjoying “the benefits of society without being subject to any of its constraints.”

How did the papers come to light?

German newspaper Suddeutsche Zeitung received the documents and then shared them with ICIJ, a Washington-based group that coordinated the investigation.

More than 380 journalists from 67 countries, analysed the documents and partner organisations included The New York Times, The Guardian, BBC and The Indian Express.

What are the other such leaks?

The Paradise Papers leak is the latest in a series of offshore leaks. It follows the 2016 Panama Papers, that examined documents leaked from a Panama law firm; the 2015 Swiss leaks that uncovered a tax evasion scheme which thrived with the knowledge of banking giant HSBC; and the April 2013 Offshore Leaks that disclosed details of 130,000 offshore accounts.

Panama Papers, which uncovered leaks from Mossack Fonseca, a Panamanian law firm, an investigation which came to be known as the Panama Papers. The Panama Papers named several world leaders, corporations and celebrities. The expose lead to the eventual ouster of Pakistani prime minister Nawaz Sharif, the resignation of Iceland’s prime minister Sigmundur Davíð Gunnlaugsson, apart from exposing how ruling elite in countries such as Russia, China, the United States all had ties to tax havens.

What was the role of Appleby?

The leaks mainly originate from Appleby, a 119-year-old firm that helps the world’s wealthy set up and manage offshore companies and accounts to avoid taxes or shroud their financial transactions in secrecy.

Appleby has responded, denying any wrongdoing on its part and saying that it is open to “any legitimate and authorised” investigation. “Appleby has thoroughly and vigorously investigated the allegations and we are satisfied that there is no evidence of any wrongdoing, either on the part of ourselves or our clients,” the company’s statement said.

Who else is involved in the leaked documents?

The leaked documents also come from Singaporean company Asiaciti Trust, which has refused to respond and official business registries in 19 secrecy jurisdictions including Antigua and Barbuda, Aruba, the Bahamas, Barbados, Bermuda, the Cayman Islands, the Cook Islands, Dominica, Grenada, Labuan, Lebanon, Malta, the Marshall Islands, St Kitts and Nevis, St Lucia, St Vincent, Samoa, Trinidad and Tobago, and Vanuatu.

What are some of the biggest revelations?

In the United States, the leaked documents have unveiled business links between Donald Trump’s commerce secretary Wilbur Ross and Vladimir Putin’s son-in-law. The paper trail reveals that Ross has a stake in a shipping company that received more than $68 million in revenue since 2014 from a Russian energy company co-owned by Kirill Shamalov, who is married to Vladimir Putin’s daughter. More than a dozen Trump cabinet advisors are named in the leaks.

The Paradise Papers also revealed that millions of pounds from Britain’s Queen Elizabeth II’s private estate were invested in offshore tax haven funds in Cayman Islands and Bermuda.

They also exposed the secret financial dealings of Stephen R. Bronfman, the chief fundraiser for Canadian prime minister Justin Trudeau.

What are the findings related to India?

India ranks 19 out of the 180 countries represented in the data in terms of the number of names. “In all, there are 714 Indians in the tally,” the Indian Express, the only Indian news organisation involved in the investigation, reported on Monday.

The Indian Express reported that corporates such as Sun TV, Essar group, Jindal Steel, Apollo Tyres, Havells, Hindujas, Emaar MGF, Videocon were named in the documents, while names such as minister of state for civil aviation Jayant Sinha, actor Amitabh Bachchan and Sanjay Dutt’s wife Manyata Dutt, BJP Rajya Sabha MP KK Sinha, liquor baron Vijay Mallya, corporate lobbyist Niira Radia also feature in the documents.

First Published: Nov 06, 2017 14:49 IST