Secret global merger of the ultra-rich and criminals exposed off-shore and online havens for ‘crooks’

The secret global merger of the ultra-rich and criminals exposed: Beginning the fightback against the off-shore and online havens for ‘crooks’

What do the Panama/Paradise Papers mean for the average person? How ‘the crooks’ really have been secretly taking over around the world in recent times? How they don’t give a damn if this means condemning your average ‘battler’ in Australia and elsewhere to an increasingly difficult struggle for future economic and general survival? And how from now on (i.e. in a world of the crooks vs. the battlers), it’s just a matter of time before the crooks are increasingly identified, their activities exposed, and justice catches up with them? With the recent publication of first the Panama Papers and now the Paradise Papers, it’s becoming clearer how corporate, political and just regular crooks have systematically ripped-off global as well as local systems to unfairly, and even criminally rort the average individual, family and local community.

As the International Consortium of Investigative Journalists (ICIJ) declared, “The leaked data covers nearly 40 years, from 1977 through the end of 2015…(allowing) a never-before-seen view inside the offshore world — providing a day-to-day, decade-by-decade look at how dark money flows through the global financial system, breeding crime and stripping national treasuries of tax revenues (1). Or as Micah White puts it in terms of this emerging evidence of ‘financial crimes against humanity’, “these leaks indicate that our earth has bifurcated into two separate and unequal worlds: one inhabited by 200,000 ultra high-net-worth individuals and the other by the 7 billion left behind. Unlike in the 99%’s world where youth languish for months and years in jail for allegedly stealing $5 worth of candy or a bottle of water, in the world occupied by the 1% getting caught stealing millions from the public … might be embarrassing but is rarely prosecuted”(2).

We now know that corporate, political and regular crooks have followed in the footsteps of corrupt third-world ‘kleptocrat’ politicians and leaders in setting up off-shore shell companies, trusts and even foundations for either ‘wealth protection’ or money-laundering purposes… who in turn followed in the footsteps of drug cartels, related organised crime syndicates (gun-running, sex slavery, financial scams, etc) and even terrorist organisations (e.g. 3). When the Panama Papers scandal first hit the news last year, two things became clear: (a) how the dodgy off-shore underworlds of crooks and the ‘ultra-rich’ had become one and the same, and (b) how related digital online worlds not only made this all possible but also provide the hidden records which will ultimately catch out most of these peoples (4) . An anonymous insider revealed to the world how the Mossack Fonseca law firm based in Panama was just one of the architects of all this. If there was any doubt that this was just an initial scratching of the surface of the extent of the problem, then this was further reinforced by release of the Paradise Papers last month – based on records leaked from the well-known offshore legal services firm Appleby as well as corporate service providers such as Asiaciti which detailed the off-shore tax evasion plans of big companies like Glencore, Nike and Google on their books (5).

As well as confirming how the rich, powerful and/or corrupt (in Australia also) squirrel their money away in off-shore havens at the expense of the global middle-class as well as poor in every country, there are two additionally interesting implications that are becoming increasingly clear. One is how big corporations often play a central role in the ripping off of even the poorest and most undeveloped countries as they exploit local natural and human resources whilst typically leaving an environmental mess as well as empty promises of wealth and development opportunities [i.e. what the economist Zucman calls the ‘hidden wealth of nations’]. Glencore’s activities in the West African nation of Burkina Faso running the Perkoa zinc mine linked to shell companies to avoid accountability as well as tax provide an exemplary insight into this kind of activity by many big corporations in so many countries for so long (6). Likewise, the ICIJ also found a lot of detailed evidence of the unethical and clearly dodgy role of Asia Pacific Resources International Holdings Ltd. (AKA April – one of the worlds largest pulp and paper producers) in at least indirectly helping to organise the illegal destruction and burn-off of key Sumatran peatland forests (7).

The second really interesting new insight is how drug cartels using shell companies to launder the proceeds of their criminal activities as regular customers of such off-shore services in places like Panama, Seychelles and British Virgin Islands (8). At the same time, this has inspired an influential notion that the illicit drug trade exemplifies a purely ruthless form of capitalism emblematic of 21st Century market forces. This has worked in two distinct if related ways. One is that ‘the war on drugs’ has (as Paley has put it) often been a pretext for how “This war is [really and/or often] about control over territory and society (and market share, cheap labor, mineral rights and profits), much more so than it is about cocaine or marijuana (9). Conversely, building on the gangster entrepreneur model of the American prohibition (10), there is also the emerging view of how drugs simply exemplify the globalisation of addiction as well as consumerism in modern society (11) – the epitome of purely ruthless market forces of engineered demand and supply.

Some would say that it’s understandable that even ‘respectable’ businessman, investors and celebrities (i.e. the rich and powerful) would want to avail themselves with the new emerging off-shore opportunities to squirrel their money away rather than contribute to much-needed public infrastructure (schools, hospitals, community resources, etc). Fair point perhaps, but we now have a society where that is the new normal – a society where people don’t give a damn about others and feel they have the right to secret their profits away into dodgy off-shore shell companies. This has promoted a growing inequality in the global economy which is quickly worsening and likely to create growing resentment and even a predictable backlash sooner or later (12). As Guardian commentator Thomas Frank put it so well in a comment about US corporate leaders that might apply to businessmen and political leaders around the world “We endure potholes and live in fear of collapsing highway bridges because our leaders wanted these very special people to have an even larger second yacht. Our kids sit in overcrowded classrooms in underfunded schools so that a handful of exalted individuals can relax on their own private beach. Today it is these same golden figures with their offshore billions who host the fundraisers, hire the lobbyists, (etc)… This is their democracy today. We just happen to live in it. …Oh, they’re happy to haul billions out of our economy and use us up in the workplace, but maintaining the machinery that keeps it all running – that’s on us. “ (13).

So why are people not already ‘rioting in the streets’ or otherwise protesting about the extent of and real impact of these ‘financial crimes’? Obviously in countries where there are authoritarian regimes and/or rampant corruption there is either repressed information about this (e.g. exemplified by the silencing of journalists) or such behaviour is regarded as normal. In developed, OECD and/or Western (i.e. so-called democratic) countries the media also fails to adequately report on or try to explain to people how much damage is being caused to their living standards or quality of life [An example of this is how a recent program about the Paradise Papers shown in Australia was programmed late at night on SBS2 a channel few people are even aware of or watch. Also, who in Russia or China would dare question the established connections with Putin or Xi Jingping’s relatives?]. In answer to this question, Guardian commentator Robert De Vries has pointed out how with the help of a compliant corporate media the general public of both middle and working classes tend to be much more concerned with the ‘perceived crimes of the poor [e.g. welfare fraud]… … than billions lost to the rich’ (14). At least the good news is that the growing anger about economic crises and lowered living standards is likely at some stage to really get more focused on the crooked nexus of the main players either directly involved in off-shore ‘wealth concealment’ extending from money laundering to tax evasion) or the politicians and/or bureaucrats helping to encourage or even ‘legalise’ such practices,. In short we predict a great global fight back to emerge soon.

– CKR 1/12/2017

ps. A week or so after the posting above, a new global inequality report was released which identified how off-shore rorts of corporate as well as criminal and ‘ultra-rich’ corruption, money-laundering, tax-evasion and general opportunism at the expense of others (such as described above) were a major factor in the acceleration of global inequality and poverty-related human misery and suffering in recent decades. Words or simple figures on a page cannot begin to encapsulate how any fair-minded human being should be extremely outraged and completely offended to the point of action by the sheer obscenity of how such rorting is directly linked to the physical, cultural and basic human resource dispossession of so many people in the world – but it’s a start: “The richest 0.1% of the world’s population have increased their combined wealth by as much as the poorest 50% – or 3.8 billion people – since 1980, according to a report detailing the widening gap between the very rich and poor… The report found that the richest 1% of the global population “captured” 27% of the world’s wealth growth between 1980 and 2016. And the richest of the rich increased their wealth by even more. The top 0.1% gained 13% of the world’s wealth, and the top 0.001% – about 76,000 people – collected 4% of all the new wealth created since 1980. The richest 0.1% of the world’s population have increased their combined wealth by as much as the poorest 50% – or 3.8 billion people – since 1980, according to a report detailing the widening gap between the very rich and poor.”
https://www.theguardian.com/inequality/2017/dec/14/world-richest-increased-wealth-same-amount-as-poorest-half?CMP=Share_AndroidApp_Gmail

References
1. https://panamapapers.icij.org/20160403-panama-papers-global-overview.html
2. https://www.theguardian.com/commentisfree/2017/nov/10/protest-paradise-papers-micah-white
3. https://www.icij.org/investigations/paradise-papers/paradise-papers-firm-managed-millions-carousel-millionaires-fraudsters/

Paradise Papers: Secrets of the Global Elite


https://www.theguardian.com/commentisfree/2017/nov/09/paradise-papers-offshore-billionaires
https://www.theguardian.com/commentisfree/2017/nov/15/benefit-scroungers-billions-rich-paradise-papers-tax-avoidance
http://www.miamiherald.com/news/nation-world/world/article70001162.html
4. http://nomadcapitalist.com/2016/02/26/how-to-avoid-offshore-scams/
5. https://www.icij.org/investigations/paradise-papers/development-dreams-stand-still-mining-money-moves-offshore/
6. https://www.icij.org/investigations/paradise-papers/leaked-records-reveal-offshores-role-in-forest-destruction/

Room Of Secrets Reveals Glencore’s Mysteries


7. https://www.theguardian.com/commentisfree/2017/nov/18/paradise-papers-tax-havens-mafia-roberto-saviano?CMP=Share_AndroidApp_Gmail
http://www.miamiherald.com/news/nation-world/world/article69943957.html
8. http://www.alternet.org/drugs/war-drugs-advance-transnational-capitalism
9. https://www.opendemocracy.net/drugpolicy/opendemocracy-dawn-paley/is-capitalism-fuelling-war-on-drugs
10. https://medium.com/audaces-fortuna-iuvat/prohibition-profits-and-power-rise-of-the-gangster-entrepreneur-4ede539b666d
11. http://www.brucekalexander.com/articles-speeches/ecological-issues/addiction,-environmental-crisis,-and-global-capitalism
https://www.wsws.org/en/articles/2017/02/25/pers-f25.html
12. https://www.theguardian.com/commentisfree/2017/nov/08/tax-havens-dodging-theft-multinationals-avoiding-tax
13. https://www.theguardian.com/commentisfree/2017/nov/09/paradise-papers-offshore-billionaires
14. https://www.theguardian.com/commentisfree/2017/nov/15/benefit-scroungers-billions-rich-paradise-papers-tax-avoidance

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