The ‘Panama Papers’ prove that the law needs to clamp down on white-collar financial crime.
According to the reports, $22.9 trillion (€20.1tn) is estimated to be hidden away in tax havens globally.
Written down in figures it is $22,900,000,000,000.
It’s a horrendously big figure. It’s probably an amount that could solve all of the world’s ills.
Yet it’s hidden away with presumably some, or much of it, obtained illegally or without paying lawful taxes.
To be sure this is only one such revelation. There are undoubtedly many more out there.
We now await further opening up of this Pandora’s Box.
There surely must be more to hand.
A look at the statistics would suggest that the extent that folk have to go to hide their money implies that there was a reason for hiding it in the first place.
One particular Panamanian accountancy company, Mossack Fonseca, which sells anonymous offshore companies around the world, is reported to have, over the last 40 years, established 214,488 offshore companies, trusts and foundations.
To ensure anonymity, fake director names were appointed so that the real owner’s name could be hidden.
Monies are funnelled through multiple shell companies in different tax havens to make it difficult to trace the money.
Over 500 banks and bank subsidiaries created 15,000 offshore companies through Mossack Fonseca.
Why would they need to?
The names of those involved who have been identified have included 143 politicians of whom a number are former and current national leaders, including their families or associates.
The Ordinary Joe or Josephine Soap isn’t included in the mass of names that have been revealed so far. Even if they were, they would be an exception to the rule.
This all might sound like fiction.
In fact, like most truths, for the vast bulk of ordinary people who struggle to survive, it is stranger than fiction.
Unfortunately, it’s true and the masses suffer as unfettered greed reigns supreme.
We have had our own share of financial scandals, tax evasion, and offshore and illegal non-resident accounts.
The Ansbacher accounts scandal is but one of many.
There are a number of things in common with the Panama Papers. They have all involved banks and financial institutions, stock brokers, accountancy firms, and weak or ineffective regulatory regimes.
Inevitably they have involved the alleged ‘great and good’, aka the powerful and those with lots of money.
This country was driven into recession by the antics of all of the above. The people of this country have had to, and will continue to have to, pay the price for their wayward ways.
With the support of their friends in government, private debt was made public, whereas profit continued to be private.
Property is a constitutional right, don’t you know? Firstly, they robbed us and then they made us pay for their losses. Apparently we have no such property rights.
What do we do? We abjectly roll over and ask for our tummies to be tickled. We then let them get on with doing the same thing again. Will we see resignations like in Iceland?
If you really want to get your heckles up, go see the movie Big Short. The movie is basically about a few brokers and investment groups who spotted as far back as 2005 that there was a major bubble in the housing sector in the US.
They decided to take a punt and ultimately made billions. Nothing was done about controlling the offending investment products they used.
The problem was not helped by the major rating agencies who continued to maintain high ratings in the sector despite the fact that all evidence was exactly opposite.
It’s hard to argue with the view that the interests of the banks, brokers and rating agencies were aligned. They all ate out of the same trough.
Even in the US, few went to jail.
The solution is simple. Crime cannot be allowed to pay, even white collar crime. Judges have too much discretion in these cases.
Let’s have mandatory sentencing.
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