It is very interesting to compare the privacy issues discussed in the Hulk Hogan sex tape case, the Apple iPhone cracking case, and the Panama Papers. The right to privacy and secrecy is good, except when it is bad. Who makes that decision depends on where you stand. If the OECD and the governments of this world had their way all secrecy and privacy would be bad. Big Brother is definitely watching and wanting a much closer look.
4
The good news boils down to: "Peekaboo, we see you!"
The fewer the secrets, the greater the security of us all.
The fewer the secrets, the greater the security of us all.
3
Will the banksters once again avoid criminal prosecution and jail as they did for their 2008 shenanigans? I have a feeling that jail in some of these third world tax havens are not pleasant. I imagine a few decades in a dark hole may make these criminals in suits think twice, but will it happen?
9
So why are there so few Americans on this list? We have Delaware. Tax havens are available right here in the USA.
14
The "progress" has come about due entirely to a class of people the U.S. government currently criminalizes. Perhaps we should rethink our policy on Snowden, Drake, Hammond, Swartz, and those I've not named. Is this not enough to qualify them as national heroes? helping the government do its job?
19
No mention of Americas tax havens, Delaware, Nevada and Wyoming. That's why few americans appear in the Panama papers, they have all the secrecy they need in America. Real estate in Miami, New-York Beverly Hills is being bought using these very same shell companies, laundering money in the process. Hey, but it's good for business... and it helps win contracts abroad. Transparency International ranks the US third in terms of being a tax haven, and expects the US to top the list by 2020, when Switzerland, Luxemburg and the UK will have curbed some of their practices.
17
Requiring documentation of a company's beneficial owner may go a long way to simplifying the global reconciliation of these entities with tax records. Perhaps banks shouldn't be allowed to transact with companies without this information (including in Delaware and Nevada).
12
People will die for this leak, mark my word.
5
Leave it to the Times to find a silver lining in tax avoidance. The Panama Papers aren't particularly good news for anyone. First, the documents were provided by a whistle blower not a government regulator or a top notch news organization. Without stolen documents, no news, no story and, we know how this paper loathes the use of stolen documents. Second, this is just the tip of the iceberg, one firm - not even the biggest - and we sweep in 160 politicians so far. Yes, and governments will protect the little guy. As long as the ability to cheat the tax man is treated as a civilized and reasonable perquisite of being wealthy, the little guy will always get the shaft. What can't be gained through legislation can always be achieved through a lucrative international shell game that is used to launder dirty money or move wealth beyond the reach of the tax man. Let's hope November arrives quickly so that Hillary can drive the money men from the temple and restore the public's faith in the Republic. Right.
18
Hillary is one of the money men in the temple. You don't earn $11 million in speaking engagements over the course of a couple of years if you are not a money man. Let's accept her for what and who she is.
4
Bernie Sanders gets my vote when it comes to rounding up tax cheats, business cheats & anyone else who makes money shafting the American taxpayer.
7
How can we look for silver linings when we can't yet see the extent of the cloud?
2
"It's an ill wind that blows no body good" is an old saying. I guess someone was trying to get rid of a politician in Sweden or show up a couple in some other country. It could have been a government convert agency... Hard to tell which one. This may only be part of what that company actually had in records. I'm pleased. I hope to see a lot more of this in the future.
5
The tax evasion biz is good biz. When the offenders go to jail for 5 years, we will see a change. Fines are useless--these are tax deductible!
16
Tax evasion is the most innocuous way to misuse this system....
If you can hide money from governments - you can launder it, make untraceable payments for rigging elections, compensate third parties for corruption and criminal services, fund terrorism...
If you can hide money from governments - you can launder it, make untraceable payments for rigging elections, compensate third parties for corruption and criminal services, fund terrorism...
8
‘It was just as Bernie Sanders predicted in 2011 during his speech to the Senate. Sanders said there was no other legitimate reason to enact a trade agreement with a country as small as Panama.’
“Panama’s entire annual economic output is only $26.7 billion a year, or about two-tenths of one percent of the U.S. economy. No-one can legitimately make the claim that approving this free trade agreement will significantly increase American jobs.
“Then, why would we be considering a stand-alone free trade agreement with this country?
“Well, it turns out that Panama is a world leader when it comes to allowing wealthy Americans and large corporations to evade U.S. taxes by stashing their cash in off-shore tax havens. And, the Panama Free Trade Agreement would make this bad situation much worse.”
‘After Obama signed the Panama free trade agreement. Can you imagine Hillary Clinton praised it as a measure to bring jobs back to America?’
“A tax haven… has one of three characteristics: It has no income tax or a very low-rate income tax; it has bank secrecy laws; and it has a history of noncooperation with other countries on exchanging information about tax matters per Rebecca Wilkins, a senior counsel for the non-partisan group Citizens for Tax Justice.”
http://www.inquisitr.com/2962702/bernie-sanders-predicted-the-panama-tax...
“Panama’s entire annual economic output is only $26.7 billion a year, or about two-tenths of one percent of the U.S. economy. No-one can legitimately make the claim that approving this free trade agreement will significantly increase American jobs.
“Then, why would we be considering a stand-alone free trade agreement with this country?
“Well, it turns out that Panama is a world leader when it comes to allowing wealthy Americans and large corporations to evade U.S. taxes by stashing their cash in off-shore tax havens. And, the Panama Free Trade Agreement would make this bad situation much worse.”
‘After Obama signed the Panama free trade agreement. Can you imagine Hillary Clinton praised it as a measure to bring jobs back to America?’
“A tax haven… has one of three characteristics: It has no income tax or a very low-rate income tax; it has bank secrecy laws; and it has a history of noncooperation with other countries on exchanging information about tax matters per Rebecca Wilkins, a senior counsel for the non-partisan group Citizens for Tax Justice.”
http://www.inquisitr.com/2962702/bernie-sanders-predicted-the-panama-tax...
36
Hmm, the Panama Papers go back to the 70s. So clearly the 2011 trade agreement was crucial. And they seem to include few if any Americans, once more showing the evils of free trade with Panama. Sanders logic?
2
Credit Suisse's $2.6 billion penalty "did not have 'any material impact on ... operational or business capabilities" because it was tax deductible. In other words, taxpayers paid for a private corporation's crime.
30
Panama? Isn't this what Delaware is for? Well, that and chicken farming.
23
I wonder how many of our gilded 1% are checking the seat availability on first flights to non extradition treaty countries? Maybe the election has more surprises for us still.
13
You mean calling the pilot and telling him to fuel the jet.
3
None. Nothing will happen to them. The republicans will slap each other on the back and cheer that the tax man was once again denied his due.
5
In 1871 a wise U.S. businessman wrote to the governor of his state the golden rule of taxation:
a rule or motto which I think it would be well for the state to adopt and have cut into the stone at the capitol (in large letters and have them gilded), in the senate chamber, the hall of the house of representatives and in the governor's office:
Never Tax Anything
That Would Be of Value to Your State,
That Could and Would Run Away, or
That Could and Would Come to You.
What doesn't run away? What is a good, wise, just tax base?
Land value. Locations are valuable. An acre in midtown Manhattan (at $250 million -- and some are more valuable than that) can easily be worth as much as 50,000 acres of decent agricultural land (at $5,000 per acre).
Land value is, as many wise people have pointed out, the ideal tax base. Adam Smith, Henry George, Milton Friedman are three whose names jump to mind, but there is a much larger literature available.
Land can't be hidden. Land doesn't leave town in the middle of the night. Its value rises as a result of community presence and activity and investment, and there is no logic or justice in permitting anyone to privatize that value.
The annual value of land represents natural public revenue, and we ought to be collecting it.
Similarly, the value of our non-renewable natural resources rightly belongs to all of us. Collecting it would help to eliminate the monopolies and the privileges we currently grant to the FIRE sector.
a rule or motto which I think it would be well for the state to adopt and have cut into the stone at the capitol (in large letters and have them gilded), in the senate chamber, the hall of the house of representatives and in the governor's office:
Never Tax Anything
That Would Be of Value to Your State,
That Could and Would Run Away, or
That Could and Would Come to You.
What doesn't run away? What is a good, wise, just tax base?
Land value. Locations are valuable. An acre in midtown Manhattan (at $250 million -- and some are more valuable than that) can easily be worth as much as 50,000 acres of decent agricultural land (at $5,000 per acre).
Land value is, as many wise people have pointed out, the ideal tax base. Adam Smith, Henry George, Milton Friedman are three whose names jump to mind, but there is a much larger literature available.
Land can't be hidden. Land doesn't leave town in the middle of the night. Its value rises as a result of community presence and activity and investment, and there is no logic or justice in permitting anyone to privatize that value.
The annual value of land represents natural public revenue, and we ought to be collecting it.
Similarly, the value of our non-renewable natural resources rightly belongs to all of us. Collecting it would help to eliminate the monopolies and the privileges we currently grant to the FIRE sector.
9
"the onus for detecting evaders will fall on the governments themselves" - seems like our Republican led Congress probably wouldn't do their job on this either - too many corporate backers.
16
We should consider these deadbeats a national security threat - given that they continue to cheat our national defense of resources needed to keep them - ironically - wealthy.
28
While it's nice to see a country's government fall I like it better when these guys meet the same end as Khadafi or Mousillini or the guys running France when they cleaned house. That tends to teach, at least to the tyrant at the pointy end of the stick, a stronger lesson.
Too bad we offshored pitchfork manufacturing.
Too bad we offshored pitchfork manufacturing.
12
Why aren't these lotharios of fraud and corruption treated to the same justice meted out to poor men selling "loose cigarettes," on the streets of SI. These criminals wreak a type of havoc on the economies and societies of those whom have conferred this largess upon them; and these are their thanks. these crimes are violent and cause real harm to nations. These criminals should not be given passes when they are caught, they should be locked into maximum security prisons and left with general population. This would at least cause some deterrence to their greedy criminal actions. Behind every great fortune is a great crime. these are not honorable human beings.
50
This is what I said in comment on Erlangers article but applies here too.
Bradley Birkenfeld the American whistleblower was the only one to go to jail. DOJ bungled trials, didn't prosecute etc. look it up. But you won't see it in the NYT because they had a reporter who couldn't get her facts straight and then she left and no one else at the NYT was interested, even Nocera. Birkenfeld went to jail not knowing he would get anything out of the whistleblowing law. But ultimately he did. Feds estimate they collected over $5BILLION in taxes owed on offshore hidden wealth because of Birkenfeld. Keep watching for more. But you won't see it in the NYT. Why?
Bradley Birkenfeld the American whistleblower was the only one to go to jail. DOJ bungled trials, didn't prosecute etc. look it up. But you won't see it in the NYT because they had a reporter who couldn't get her facts straight and then she left and no one else at the NYT was interested, even Nocera. Birkenfeld went to jail not knowing he would get anything out of the whistleblowing law. But ultimately he did. Feds estimate they collected over $5BILLION in taxes owed on offshore hidden wealth because of Birkenfeld. Keep watching for more. But you won't see it in the NYT. Why?
36
Why not figure out for yourself if you can do this move you money abroad? See what happens!
1
Why the surprise? As a former bank regulator in the US, Panama had been on a money-laundering watch list since the 90s. Here is a clue to tax authorities world-wide, look into:
- Malta
- Cyprus
- Israel
- Singapore
- Lebanon
At least Singapore has announced that going forward they will comply with anti money laundering rules, but even that, is a mirage....banks there face a "maximum" of SGD 1 million fine. And they announced a three year window (hurry, get your money in here before we enforce the rules).
- Malta
- Cyprus
- Israel
- Singapore
- Lebanon
At least Singapore has announced that going forward they will comply with anti money laundering rules, but even that, is a mirage....banks there face a "maximum" of SGD 1 million fine. And they announced a three year window (hurry, get your money in here before we enforce the rules).
13
And once again, as with their bankers following the financial crisis, Icelanders lead the way.
http://www.nytimes.com/2016/04/06/world/europe/panama-papers-iceland.html
http://www.nytimes.com/2016/04/06/world/europe/panama-papers-iceland.html
8
I'm surprised anyone didn't assume this was already happening.
The naivete reflected in this poll is frightening-
http://asktheinternet.com/question/are-you-surprised-by-the-panama-paper...
The naivete reflected in this poll is frightening-
http://asktheinternet.com/question/are-you-surprised-by-the-panama-paper...
4
Why the positive spin NYTimes?
We are still waiting for the publication of all US politicians and public servants and Federal Reserve peeps with Shell Corps and the value of those corps.
We are still waiting for the publication of all US politicians and public servants and Federal Reserve peeps with Shell Corps and the value of those corps.
20
Follow the money. Switzerland and Luxembourg.
1
But none of the corporate enablers or coconspirators go to prison! Humans, little guys, who engage in tax evasion go to prison.
12
For legal purposes, corporations are considered as "fictitious persons" before the law, with this recently also endorsed by the Supreme Court in elections, making it easier for corporations to write their own laws. As a "fictitious person", this means everyone in the corporation can go to jail for criminal wrong doing, and certainly the people at the top, who are most responsible. Of course, if they have bought the politicians, including their appointed authorities, who always have their hand out to these very people, we might not expect much, or any prosecution, which seems to be the case.
5
AAARRRGGHHH! "Data-sharing measures" ... "anti-evasion efforts" ... "relying on bankers to report data" ... "Foreign Tax Compliance Act" ... "sharing information" ... How long will the U.S. and our financial partners put up with "tweaking" the federal income tax system. It doesn't work. It can't work. It will never work. It requires people to self-report income and then it provides ways for people and companies to exclude income from taxable income. It's a shell game, whose beneficiaries run the game.
We need a simple, direct, TRANSPARENT, flat tax on consumption (like the Fair Tax) that takes "reporting" and "exemptions" and "exclusions" out of the process. And we need it now!
We need a simple, direct, TRANSPARENT, flat tax on consumption (like the Fair Tax) that takes "reporting" and "exemptions" and "exclusions" out of the process. And we need it now!
6
".... and the introduction next year of new international data-sharing measures from the Organization for Economic Cooperation and Development, ...." I have the impression that the United States has tried hard to weaken this data sharing agreement. Does anyone have reliable information about the role of the United States?
5
What about the estimated 799 other law firms doing the same thing?
13
I'm glad NYT was able to find the silver lining in this data dump. Great work!
Now maybe they could focus on more in depth reporting on the substance of the disclosures as they relate to U.S. citizens seeking to avoid their tax obligations.
Now maybe they could focus on more in depth reporting on the substance of the disclosures as they relate to U.S. citizens seeking to avoid their tax obligations.
11
This leak is from the #4 law firm... So presumably the #1, #2 and #3 largest firms would show even more tax evasion and money laundering?
19
No one scoffs at paying $2.6bn. The Credit Suisse CEO was merely telling investors that the bank could still afford to keep the lights on and pay its employees.
1
The good news is that leakers / hackers are putting this information on the internet. The more often this stuff is leaked, the more people will think twice about trying to get away with it.
7
It's like it's some type of sociopathic game - avoid the most taxes, win the bragging rights at your social gathering! Exactly how big of a credibly-unspendable pile of money do these people need to feel good about themselves??
3
We've known that this has been going on for a long, long time. Both the Republicans and the Democrats have been duplicitous in allowing this to go on. In fact the US is a tax haven for those stealing from Russia, Latin America and China. For American tax cheats (corporate officers included) I'd have long prison sentences.
6
"The war on rampant tax evasion may not be hopeless after all."
That says it all. It is obvious that Mr. Eavis either does not understand the difference between "tax evasion" and "tax avoidance" or is deliberately conflating the two. They are in fact radically different.
Tax avoidance through the use of lawful plans and mechanisms to minimize tax liabilities is perfectly legal. Tax evasion, on the other hand, is an attempt to escape tax liability through a variety of unlawful acts, such as, e.g., deliberate under reporting, etc. Evasion is a crime under U.S. tax law; but avoidance is entirely lawful. As for Iceland, Russia, et al., who knows?
The obvious moral and political questions posed by highly placed government officials' use of such havens to shelter personal assets are disturbing; however, the legal ramifications, if any, remain open to question...
That says it all. It is obvious that Mr. Eavis either does not understand the difference between "tax evasion" and "tax avoidance" or is deliberately conflating the two. They are in fact radically different.
Tax avoidance through the use of lawful plans and mechanisms to minimize tax liabilities is perfectly legal. Tax evasion, on the other hand, is an attempt to escape tax liability through a variety of unlawful acts, such as, e.g., deliberate under reporting, etc. Evasion is a crime under U.S. tax law; but avoidance is entirely lawful. As for Iceland, Russia, et al., who knows?
The obvious moral and political questions posed by highly placed government officials' use of such havens to shelter personal assets are disturbing; however, the legal ramifications, if any, remain open to question...
8
This should be an editor's pick. The first thing I learned in tax accounting in college was the difference between evasion and avoidance. Everyone engages in tax avoidance. Your 401K contributions are a tax avoidance scheme.
4
It is clear that Switzerland (and Luxembourg) need to be designated and treated as international pariahs. They openly enable corrupt tinpot dictators around the world to steal, and the comfortable lifestyle of the Swiss is built on misery for the people of the poor countries. This is just another form of economic violence, which is just as effective as physical violence in shortening lifespans and destroying the quality of life of the people it affects. It is worse than physical violence because it is so insidious, and the bankers can seem like such reasonable and "cultured" people who love Mozart and can talk at length about Kant and Keats.
At the very least, there needs to be concerted UN or non UN based international action against these countries. At the individual level, we need to boycott them -- don't buy their stuff, don't travel there.
At the very least, there needs to be concerted UN or non UN based international action against these countries. At the individual level, we need to boycott them -- don't buy their stuff, don't travel there.
6
Indeed, TheUpshot correctly reports progress in efforts to reduce "tax evasion" - the unlawful activity designed to eliminate or reduce tax burdens. And, yes, there will be other stories with other objectives that will come out of this particular “leak.”
But in all reporting on this very broad subject of “overseas tax havens,” care should be taken to identify and thoroughly investigate those practices that are "tax avoidance" - the acceptable methods of reducing taxes.
Involvement in over four decades of law practice, inside and outside corporate business, has exposed me to the diversity of means to lower tax burdens worldwide. We in this country have a long tradition of supporting legal ways to reduce taxes, and that is a significant factor in our creation of a relatively fair tax system in comparison to many other countries - whatever faults can be found in it.
With the way the presidential campaigns are going these days, this particular leak and its revelations should not be a campaign issue: Even as reflected in the comments to this article, there are too many shots from the hip and unfounded assumptions to support decent campaign discussion until more is known.
But in all reporting on this very broad subject of “overseas tax havens,” care should be taken to identify and thoroughly investigate those practices that are "tax avoidance" - the acceptable methods of reducing taxes.
Involvement in over four decades of law practice, inside and outside corporate business, has exposed me to the diversity of means to lower tax burdens worldwide. We in this country have a long tradition of supporting legal ways to reduce taxes, and that is a significant factor in our creation of a relatively fair tax system in comparison to many other countries - whatever faults can be found in it.
With the way the presidential campaigns are going these days, this particular leak and its revelations should not be a campaign issue: Even as reflected in the comments to this article, there are too many shots from the hip and unfounded assumptions to support decent campaign discussion until more is known.
While the O.E.C.D. is a good first step toward international financial transparency, obviously there need be far more stringent international joint efforts to monitor and police secret offshore tax havens and money laundering. While now, our efforts are voluntary and fragmented, technologies are currently available to detect and track large currency transfers and to monitor suspicious transactions worldwide. The same efforts used against political/religious terrorists can be employed to international economic terrorists as well.
9
I would very much appreciate the issue of corporate tax "avoidance" which amounts to potentially trillions as legitimate American companies keep profits offshore as well as this issue of large scale outright tax fraud becoming a central issue in this Presidential election. Laws and regulations need to be updated for this modern era and laws far more stringently enforced internationally.
37
The good news is that not only is the system getting somewhat better than before, but that it is clear that once the public can be educated about their delusion about the benefits of low taxes and small government, a significant segment of society's ills can be ameliorated by:
1. Closing the tax loopholes which are really only of use to the 1%.
2. Changing the tax system to favor lower taxes for work related income, and higher taxes for investment income.
3. Rebuilding the public infrastructure of education, healthcare, safety, and security - along with the GOVERNMENT regulatory functions which catch the tax evaders.
The true conservatives will recognize that no government is just lawlessness, where the rich ultimately win, and that smart government can empower the individual to achieve their potential in a safe and secure environment.
1. Closing the tax loopholes which are really only of use to the 1%.
2. Changing the tax system to favor lower taxes for work related income, and higher taxes for investment income.
3. Rebuilding the public infrastructure of education, healthcare, safety, and security - along with the GOVERNMENT regulatory functions which catch the tax evaders.
The true conservatives will recognize that no government is just lawlessness, where the rich ultimately win, and that smart government can empower the individual to achieve their potential in a safe and secure environment.
48
I would not be surprised if many of these corporations are for perfectly legal purposes.
If you want to own foreign real estate you almost always need to create a holding corporation. I have land in Costa Rica. It's illegal according to Costa Rican law for a foreigner to personally own land, but I could legally buy it via a Costa Rican Corp.
No money laundering here - just the way to own a little bit of paradise.
If you want to own foreign real estate you almost always need to create a holding corporation. I have land in Costa Rica. It's illegal according to Costa Rican law for a foreigner to personally own land, but I could legally buy it via a Costa Rican Corp.
No money laundering here - just the way to own a little bit of paradise.
2
So it's illegal for you to own land in Costa Rica, but you found a loophole to do it just the same. The moral of this story isn't what you seem to think it is.
9
Matt, I think it's safe to say the example you give of creating an offshore holding company in Costa Rica so you can legally buy land there is a TINY fraction of the cases of people holding offshore accounts - Tax Evasion being the huge majority ;-).
and break the law
3
It's a little depressing that the NY Times points to FATCA as part of the solution to tax evasion.
FATCA mostly represents a costly compliance requirement for banks and American's abroad with severe penalties for making a filing mistake - no matter that the vast majority of account holders owe no taxes.
As this article notes, shell corporations are the main means to hiding wealth, not individual accounts which are subject to FACTA.
I wish the NY TImes reporters actually knew their material rather than regurgitating press releases.
FATCA mostly represents a costly compliance requirement for banks and American's abroad with severe penalties for making a filing mistake - no matter that the vast majority of account holders owe no taxes.
As this article notes, shell corporations are the main means to hiding wealth, not individual accounts which are subject to FACTA.
I wish the NY TImes reporters actually knew their material rather than regurgitating press releases.
6
Tax evasion should not be an entitlement program for the rich.
34
It isn't. Tax "avoidance," on the other hand might be. There's a difference...
1
Nobody cares about Putin's cellist. Print the names of the Americans named in the leak, so the criminal investigations may begin.
69
Too many left wing progressives will be "outed" if names are "named," so don't hold your breath...
Whomever wrote the headline "Finding the Good News in Widespread Tax Cheating" deserves to be fired. The only "good news" is the exposure of this kind of immoral activity; there can be no other good news outside of the elimination of these kinds of shelters, which go along way toward redistributing wealth upwards and maximizing income inequality.
70
It would be interesting if a certain wealthy presidential candidate was caught up in this? Wouldn't be a big surprise; would it? Matter-of-fact, it wouldn't be a surprise if all of them were involved one way or another.
17
to continue...Letter to NYTimes editor from ex-Senator Carl Levin of Michigan
Second, Congress should pass bipartisan legislation that I, Senators Chuck Grassley, Sheldon Whitehouse and others have sponsored requiring states to get the names of the people behind the companies they form, the so-called beneficial owners. Incorporation was never intended to hide company ownership.
Some secretaries of state who collect fees for incorporating new companies oppose these reforms, arguing that asking questions about who uses their services will lower their income. That argument didn’t work when some banks fought compliance with anti-money-laundering safeguards, and it shouldn’t work here.
When so much else seems beyond the ability of government to repair, stopping the formation of United States companies with hidden owners should be a no-brainer.
Feb 2015
We agree with Carl Levin.
Second, Congress should pass bipartisan legislation that I, Senators Chuck Grassley, Sheldon Whitehouse and others have sponsored requiring states to get the names of the people behind the companies they form, the so-called beneficial owners. Incorporation was never intended to hide company ownership.
Some secretaries of state who collect fees for incorporating new companies oppose these reforms, arguing that asking questions about who uses their services will lower their income. That argument didn’t work when some banks fought compliance with anti-money-laundering safeguards, and it shouldn’t work here.
When so much else seems beyond the ability of government to repair, stopping the formation of United States companies with hidden owners should be a no-brainer.
Feb 2015
We agree with Carl Levin.
65
We agree with this NYTimes Letter to editor:
“Towers of Secrecy” (series, front page, Feb. 8-12) described corrupt public officials and other wrongdoers who use shell companies to take secret ownership of multimillion-dollar apartments in New York City. Some used shell companies formed here in the United States, taking advantage of state incorporation practices that permit the routine formation of companies with hidden owners.
Right now, our states require more identification to get a driver’s license than to set up an American company. When the companies are later misused by corrupt dictators, drug lords or terrorists laundering dirty money through cash payments for American real estate, law enforcement investigations are stymied by a lack of meaningful United States company ownership information.
Two actions could effectively end the abuses. First, the administration should revoke a 13-year-old “temporary” regulation exempting real estate and escrow agents from an anti-money-laundering law requiring them to know their customers and report suspicious transactions to law enforcement. The administration doesn’t need Congress to close that regulatory loophole; it just needs to get its own house in order.
Second..to follow
CARL LEVIN
Detroit
“Towers of Secrecy” (series, front page, Feb. 8-12) described corrupt public officials and other wrongdoers who use shell companies to take secret ownership of multimillion-dollar apartments in New York City. Some used shell companies formed here in the United States, taking advantage of state incorporation practices that permit the routine formation of companies with hidden owners.
Right now, our states require more identification to get a driver’s license than to set up an American company. When the companies are later misused by corrupt dictators, drug lords or terrorists laundering dirty money through cash payments for American real estate, law enforcement investigations are stymied by a lack of meaningful United States company ownership information.
Two actions could effectively end the abuses. First, the administration should revoke a 13-year-old “temporary” regulation exempting real estate and escrow agents from an anti-money-laundering law requiring them to know their customers and report suspicious transactions to law enforcement. The administration doesn’t need Congress to close that regulatory loophole; it just needs to get its own house in order.
Second..to follow
CARL LEVIN
Detroit
50
Mr. Sanders called it back in 2011. Panama Papers: Obama, Clinton Pushed Trade Deal Amid Warnings It Would Make Money Laundering, Tax Evasion Worse. Read Mr. Sanders warning, prescient.
71
This tiny little story trying to say that everything is all right and that things are being fixed is a travesty. The Panama Papers is a huge story. If the New York Times doesn't start to cover the story, the reputation of the New York Times--already in question, may suffer yet another decline.
145
They don't actually have access to the leaked files, so they can't do much more than report on reporting at this point.
7
This is a major story and you are still not covering it adequately. As a long time reader, I am very disappointed. We understand that you were not one of the news agencies to receive the initial leak, but now is the time to step up and expose this scandal adequately, even if it means acknowledging other news sources beside yours.
145
Apparently, we need to wait for the next tranche, with some American names on it. No doubt; this will leap above the fold if there is a Trump link.
14
It's important to be fair and restrained about this information. However, the existence of these havens has never been a good practice to legalize. They are ways that money gets into the Panamanian economy, by the "clients" paying the local government for services rendered. Huh. Also seems to bring in wealthier tourists, too. They come to be close to their money.
2
Information sharing agreements are all well and good, and they can produce results, no question, but the potential for blockbuster cover-blowing disclosures also exists with leaks, the work of hackers. Anyone who seeks to squirrel away their ill-gotten gains or tax-evading wealth in an offshore hideaway runs the risk they will be outed. Even the legitimate users of these foreign entities run the risk of having their personal affairs disclosed and being lumped together with crooks and cheats who have used the services of the same firms
Cheating on taxes and corruption are high risk business, not for the faint of heart. The cheaters and crooks can never be satisfied they have actually gotten away with whatever they have done. No doubt there are many of them for whom paper trails left decades ago still cause sleepless nights
Cheating on taxes and corruption are high risk business, not for the faint of heart. The cheaters and crooks can never be satisfied they have actually gotten away with whatever they have done. No doubt there are many of them for whom paper trails left decades ago still cause sleepless nights
2
Likely, what they are doing is legal in all countries concerned. Not saying it should be, but... First heard about this sort of stuff in 1969-70. A firm my dad was working for, pharmaceuticals, ran through a numbered account in the Bahamas. Quite legal, old chap. Pip pip. It's not good, but this is what private capital does. They're the kind of people who are seriously thinking of going on to some hyper-secure encrypted money to pass undetectably around the world. Money in an orbit around the moon. You want it? Go get it.
5
It is always amusing to see how everyone assumes that hiding funds offshore is done only for tax evasion or to hide the fruits of crime. Many people living in dicy undemocratic right or left leaning countries seek to secretly keep money outside of their country for political insurance. Such practices saved many lives during WWII.
Sophisticated money launderers would never go near such a huge operation as Mossack Fonseca, one that needed to keep all the information on a database.. Clearly fashionable but naive lawyers and accountants all over the world were steering business to them without a care about security. Forget the bankers and crackdown on the professionals and you will get results.
Sophisticated money launderers would never go near such a huge operation as Mossack Fonseca, one that needed to keep all the information on a database.. Clearly fashionable but naive lawyers and accountants all over the world were steering business to them without a care about security. Forget the bankers and crackdown on the professionals and you will get results.
3
Oh yeah, Putin is just hiding his nest egg, in case World War 3 breaks out!
Dude, the ONLY reason these guys were caught was a massive leak! Their operation was working just fine! They were never caught legitimately!
Dude, the ONLY reason these guys were caught was a massive leak! Their operation was working just fine! They were never caught legitimately!
32
With digital databases there are always leaks, When you use the telephone (discreetly), keep minimal files and make sure that none of the players know each other nor the real party in interest nothing leaks unless there is a messy divorce.
Putin didn't have to be careful as there is no political or legal risk - it's nice to be king - but the lack of sophistication of people with something at stake is breathtaking.
Putin didn't have to be careful as there is no political or legal risk - it's nice to be king - but the lack of sophistication of people with something at stake is breathtaking.
2
This is one company, there are many others. There is a huge chunk of money that cannot be accounted for in the global economy. Well look where it is, not a surprise.
The NYTimes should be asking itself why it was not on the list of media outlets to receive these files? Perhaps a bit too close to its readership? Why is this story not getting headlines? Just wait it will. Remember all those Swiss bank accounts that were tax dodges?
The NYTimes should be asking itself why it was not on the list of media outlets to receive these files? Perhaps a bit too close to its readership? Why is this story not getting headlines? Just wait it will. Remember all those Swiss bank accounts that were tax dodges?
97
You show a touching faith in the narrative, Mr. Eavis. Unfortunately current events aren't a narrative. Narratives are what we impose on events once they're no longer current.
The Panama Papers will have no impact on the autocrats who feature most prominently in them. The leaders of Russia, China, and Saudi Arabia will continue to do as they please with their peoples' money. And why should anybody care? They've done much worse things, and if that matters to you then this is pony-league stuff. Besides, the concept of nabbing an otherwise untouchable criminal through tax code is something that requires rule of law and accountability.
So far the only national leader these revelations might topple is...the Prime Minister of Iceland. Outside of Iceland, that's not exactly a compelling story. Well, not unless it's done with an axe by a rebellious thegn in the burning mead-hall.
Now there's a narrative for you.
The Panama Papers will have no impact on the autocrats who feature most prominently in them. The leaders of Russia, China, and Saudi Arabia will continue to do as they please with their peoples' money. And why should anybody care? They've done much worse things, and if that matters to you then this is pony-league stuff. Besides, the concept of nabbing an otherwise untouchable criminal through tax code is something that requires rule of law and accountability.
So far the only national leader these revelations might topple is...the Prime Minister of Iceland. Outside of Iceland, that's not exactly a compelling story. Well, not unless it's done with an axe by a rebellious thegn in the burning mead-hall.
Now there's a narrative for you.
10
I wonder if crypto-currency is setting up to step in when and if the jig is up on offshoring?
10
Excellent insight. See recent papers by well-regarded cryptology researchers (eg by Aril Juels) on the inevitability of "criminal smart contracts" that can automate crypto currency transactions for money laundering and contract killing.
1
How fascinating is the NYT role in the new cold war with Russia;. So the Panama papers are released, and the only tax evader mentioned is a buddy of Vladimir Putin, plus a Photo of the two of them;.this would infer that there are no U.S. citizens who hide away their money to avoid taxes. How come no mention of the Argentine president, Macri and his father who are implicated in the Panama Papers. So much for the objectivity of NYT journalism.Risable if not sad.
57
Macri was mentioned in a more prominent article today.
http://www.nytimes.com/2016/04/05/world/europe/panama-papers-leaks-put-i...
http://www.nytimes.com/2016/04/05/world/europe/panama-papers-leaks-put-i...
6
Prison for tax evaders is the real way to progress. If you don't enforce the laws against tax evasion, you select for creative, and illegal means of avoidance.
24
Jail time it is.
2
Making it even easier for Panamanian law firms to assist US tax dodgers is a special trade agreement signed by Obama & championed by HRC at State. Did anyone object at the time? Yes, Sen. Bernie Sanders. Remember this when voting in a Dem primary.
83
This article makes an excellent case for simple flat taxation systems rather than convoluted systems based on high rates and vast array of loopholes and deduction. Complexity in tax codes is an invitation for corruption.
The goal of taxation should be to produce the maximum amount of revenue for necessary government expenditures at the lowest economic cost, not to engage in social engineering and redistribution.
Corporate and individual tax systems based on high progressive rates and 100,000 pages of loopholes and deductions invite tax avoidance, tax evasion, and government corrupt on a trillion dollar scale.
Make the tax system based on simple flat rate with no deductions at all (just like property taxes) and compliance will go up, cost of tax preparation will go down, and the billions of corrupt dollars flowing through Washington DC will go down, and tax revenue will rise.
Everyone wins except for the army of tax lawyers and lobbyists who run the Washington Cartel.
The goal of taxation should be to produce the maximum amount of revenue for necessary government expenditures at the lowest economic cost, not to engage in social engineering and redistribution.
Corporate and individual tax systems based on high progressive rates and 100,000 pages of loopholes and deductions invite tax avoidance, tax evasion, and government corrupt on a trillion dollar scale.
Make the tax system based on simple flat rate with no deductions at all (just like property taxes) and compliance will go up, cost of tax preparation will go down, and the billions of corrupt dollars flowing through Washington DC will go down, and tax revenue will rise.
Everyone wins except for the army of tax lawyers and lobbyists who run the Washington Cartel.
8
"The goal of taxation should be ... not to engage in social engineering and redistribution." What a silly statement. I won't bother explaining why, because if you read the Times lately you've already seen multiple reasons explained every week.
4
The moral message in this news cycle is "people who control offshore companies are probably up to no good". The reporters that spread it don't care about the damage they do to regular people like me living and doing business out in the wide world.
I have more than 10 "offshore accounts" in 4 countries outside of the US. Some are savings accounts, some are stock trading accounts, and most are business banking accounts for the 3 "foreign" companies that I control. This year I expect to create one or two more subsidiary companies as we continue to grow, and reorganize things under a holding company (disparagingly called a shell company structure by reporters).
The next time you read a headline about "offshore banking" and "a web of foreign companies", remember this: my family's daily living expenses are paid from a foreign bank account, and my business making apps operates as a collection of foreign companies with bank accounts in multiple countries that are used to pay Americans, Indonesians, Malaysians, New Zealanders, Canadians, Germans, French, and Taiwanese people. We don't have a bat cave or a private island, we're not laundering terrorist's money or running drugs, and we're paying 30%-40% in personal income taxes.
If we're guilty of anything, it's exercising liberty in picking the Caesars around the world to whom we render their due.
I have more than 10 "offshore accounts" in 4 countries outside of the US. Some are savings accounts, some are stock trading accounts, and most are business banking accounts for the 3 "foreign" companies that I control. This year I expect to create one or two more subsidiary companies as we continue to grow, and reorganize things under a holding company (disparagingly called a shell company structure by reporters).
The next time you read a headline about "offshore banking" and "a web of foreign companies", remember this: my family's daily living expenses are paid from a foreign bank account, and my business making apps operates as a collection of foreign companies with bank accounts in multiple countries that are used to pay Americans, Indonesians, Malaysians, New Zealanders, Canadians, Germans, French, and Taiwanese people. We don't have a bat cave or a private island, we're not laundering terrorist's money or running drugs, and we're paying 30%-40% in personal income taxes.
If we're guilty of anything, it's exercising liberty in picking the Caesars around the world to whom we render their due.
5
Congrats. Why are you whining?
8
Exercising liberty in picking the Caesars around the world to whom we render their due? That's rich.
If you're an American, you should be reporting your income in America and paying taxes in America.
When you put your money in a secret bank account, and that money makes money, and you fail to report that income because you know the bank will keep your secret from the American tax authorities, you are stealing from all the Americans who play by the rules and pay their taxes. The rest of us pay more because you pay less.
Taxes are the price we pay for civilization, sir. Pay up.
If you're an American, you should be reporting your income in America and paying taxes in America.
When you put your money in a secret bank account, and that money makes money, and you fail to report that income because you know the bank will keep your secret from the American tax authorities, you are stealing from all the Americans who play by the rules and pay their taxes. The rest of us pay more because you pay less.
Taxes are the price we pay for civilization, sir. Pay up.
23
Article about off shore tax evasion and money laundering. I don't think that anyone has intimated that any offshore account is specious. I am wondering at your narcissistic identification with something that clearly does not apply to your situation.
4
The leak of the Panama Papers give countries the opportunity to deal with their corrupt people in Government and industry. Everyone should pay taxes and money launderers must have their day in Court.
This is a great opportunity for law enforcement agencies to follow through. Just make sure taxes were paid and act on it if they were not.
On the other hand, let us not make a witch hunt. There are many legitimate reasons to have off-shore companies in Panama or other countries. People that made honest money and paid their taxes already may want to do Estate planning or may be living in countries where kidnapping is a profitable industry.
Let us not put innocent people in the same bag with crooks. Let us go one step further, let Congress pass laws to close tax loopholes. I know it is a fantasy to think that Congress will actually do its jobs to produce Bills, negotiate and vote to make law.
This is a great opportunity for law enforcement agencies to follow through. Just make sure taxes were paid and act on it if they were not.
On the other hand, let us not make a witch hunt. There are many legitimate reasons to have off-shore companies in Panama or other countries. People that made honest money and paid their taxes already may want to do Estate planning or may be living in countries where kidnapping is a profitable industry.
Let us not put innocent people in the same bag with crooks. Let us go one step further, let Congress pass laws to close tax loopholes. I know it is a fantasy to think that Congress will actually do its jobs to produce Bills, negotiate and vote to make law.
9
Oh yeah Aurace, legitimate, hard working, middle class families all over the country use off-shore accounts all the time as part of their estate planning.
You are looking at the symptoms of existing tax loop holes. We don't need any new ones! No innocent people put their monies in Panama or the Bahamas, or Luxumborg, or wherever unless they are doing business there.
Put your money in the banks at Miami Beach or where ever you are. And if you don't like the interest rates, invest it on Wall Street right here in America, legitimately.
You are looking at the symptoms of existing tax loop holes. We don't need any new ones! No innocent people put their monies in Panama or the Bahamas, or Luxumborg, or wherever unless they are doing business there.
Put your money in the banks at Miami Beach or where ever you are. And if you don't like the interest rates, invest it on Wall Street right here in America, legitimately.
26
Here's another reason to honorably have an offshore corporation - buying real estate. A lot of countries in Central America don't permit foreigner to buy property, but do allow foreigner to create a holding company that does own the land.
3
White collar crime in the west is an accepted business practice with few and usually minor financial penalties. How do you deduce that legal offshore account holders will be ill used?
1
This election should be more focused on the corps and Street---powerful enough to write legislation if you're Jamie Dimon or a lobbyist for a giant insurance company.
This is why incrementalism won't work. The rot from greed is too entrenched. A vulture capitalism corrupt political system doesn't respond to laws, while at state levels we're kept arguing about abortion and LGBT.
Grand Theft, abetted at the top including SCOTUS.
And they wonder why people are angry.