What the Panama Papers Reveal

Panama-Papers

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What are the Panama Papers?

The Panama Papers are a collection of leaked company documents.

● Documents leaked from Panama-based law firm and corporate service provider, Mossack Fonseca
● Documents which give us a glimpse into how the rich and powerful avoid taxes, and how they keep personal financial information private
● Documents that show which countries are being used as tax havens

What is the Scope of the Documents?

● Over 11.5 million documents were leaked
● 2.6 Terabytes of data in total
● Documents span from 1977 to December of 2015
● 214,488 entities are mentioned in the documents
● Number of current or former country leaders, heads of state and government: 12
● Number of relatives and associates of country leaders mentioned: 61
● Number of other current or former politicians and public officials: 128
● Number of billionaires connected: 29
● Number of countries and territories which are connected to the data: 204
● Number of banks, subsidiaries and branches: 511
● Number of shell companies created by the 511 banks: 15,579
● An estimated $22.9 Trillion USD is hidden away globally in shell companies and tax havens, as suggested by these documents

Top Ten Most Popular Tax Havens Revealed by the Leak:

● British Virgin Islands
● Panama
● The Bahamas
● Seychelles
● Niue
● Samoa
● British Anguilla
● Nevada
● Hong Kong
● The United Kingdom

A tax haven is a country or an independent area where taxes are levied at a low rate, making it a desirable place to hold investments in an effort to evade being taxed at a proper rate.

Top Scandals Revealed by the Leak

● A $2 billion USD offshore trail that allowed Putin’s inner circle to become wealthy, which points to Putin helping to set it up.
● Iceland’s’ Prime Minister Sigmundur Davíð Gunnlaugsson and his wife have an offshore account which houses his wife’s investments, in a possible tax evasion move.
● Ukraine’s president, Petro Poroshenko, set up a secret offshore company in the British Virgin Islands while waging a war with Russia and pro-Moscow rebels.
● Mossack Fonseca’s co-founder, Jürgen Mossack helped hide the profits from the Brink’s-Mat gold bullion robbery.
● David Cameron’s late father, Ian Cameron, used an offshore account to avoid paying taxes in the UK.
● Fifa president Gianni Infantino has been tied to world football corruption due to racketeering and bribery.
● Mossack Fonseca worked with oil firms owned by Iran despite United Nations sanctions

The Investigation:
● German newspaper German newspaper Süddeutsche Zeitung realizing the scope of the documents requested help from the International Consortium of Investigative Journalists (ICIJ).
● There were 378 journalists involved from
● 107 media organizations, located
● In 77 different countries
● The investigation took a year from the time of the leak to reach completion

Who is Responsible for the Leak?

The documents were leaked by a whistleblower using the pseudonym “John Doe.” John Doe leaked Mossack Fonseca’s documents to German newspaper Süddeutsche Zeitung (SZ). John Doe released a statement detailing his motivation for leaking the documents. In this text, titled “The Revolution Will Be Digitized, he stated that growing global income inequality and corruption allegedly enabled by Mossack Fonseca was the motivation for his actions.

How was the Leak Possible?:

The Panama Papers were leaked due to a security breach and email hack. This hack was possible due to the company utilizing a three-year old version of Drupal, which has several well-known security vulnerabilities. Mossack Fonseca was also not encrypting their emails, further making the hack easy to to perform.

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Sources:

http://www.irishtimes.com/business/panama-papers-in-numbers-the-facts-and-figures-1.2597624
http://www.theguardian.com/world/2016/apr/06/panama-papers-all-revelations-so-far-data-leak
http://www.bbc.com/news/world-35934836
http://www.abc.net.au/news/2016-04-05/why-the-panama-papers-mossack-fonseca-leaks-really-matters/7300262