Pandora Papers: When leaders are looters

Have you read the list of politicians named in Pandora Papers – the latest revelation of world leaders' secret wealth? More than 330 heads of state and politicians have been named in the files leaked to the International Consortium of Investigative Journalists (ICIJ).

The ICIJ gave 600 journalists remote access to the 11.9 million files and facilitated the largest journalistic collaboration ever to expose how the most powerful individuals are building empires of wealth through offshore shell companies and essentially deceiving their people. 

"The leaked records come from 14 offshore services firms from around the world that set up shell companies and other offshore nooks for clients often seeking to keep their financial activities in the shadows," an ICIJ report reads. 

However, if the names like Vladimir Putin of Russia, Tamim bin Hamad Al Thani of Qatar, Ilham Aliyev of Azerbaijan or Britain's Tony Blair in Pandora Papers surprise you, let us take you back to 2016 when the revelation of Panama Papers (11.5 million leaked files) shocked the world. 

An equally stunning revelation as Pandora, the Panama Papers revealed that powerful figures like King Salman of Saudia Arabia, Khalifa Bin Zayed al Nahyan of the UAE, Pakistan's Nawaz Sharif and Silvio Berlusconi of Italy were also involved in shady offshore shell companies. 

The Paradise Papers, published in 2017, similarly exposed how global leaders, politicians, and businessmen around the world join the shady world of offshore shell companies for tax avoidance and to hide their illegal wealth. 

Hundreds of thousands of offshore entities and shell companies connected to over 200 countries and territories appear in these papers.

Every year, billions of dollars that countries (especially the ones ruled by authoritarian regimes) could be using for infrastructure, healthcare or education are going to offshore companies through the people in leadership positions. 

This wealth, instead of serving the interest of the nation, is hidden deep within shell companies and anonymous entities in places like the British Virgin Islands. 

In case you are not familiar with shell companies, setting up a shell company is actually quite easy. 

"Secrecy World" author Jake Bernstein explains that to set up a shell company, "you can go to a place like Panama, or the British Virgin, or Delaware or Nevada - usually places with tough laws where they will not reveal who the beneficial owner is and they just layer on different aspects of anonymity." 

"For example, you could have fake directors, where you pay a little bit extra, and someone pretends to be the public face of the company," Bernstein explains, "Tax avoidance and tax evasion is not something that happens in a far off place with palm trees and ocean breezes." 

This is how these leaders buy properties with anonymous shell companies in places like the United States' Nevada or Delaware. Some shell companies are indeed legitimate. But most are clearly used for money laundering by corrupt officials and other people, who often park their illegal cash in property. 

Bangladesh is of course not outside this world of shady transfer and hiding of wealth. Remember Canada's Begum Para? Many Bangladeshis, believed to be politicians and government officials, have bought luxurious residences there. 

The area became infamous as wives and children of Bangladeshi millionaires live in these residences, while the husbands hunt fortunes for them in Bangladesh. 

"We had thought that politicians may have purchased these houses. But we have information that most of the houses there have been bought by government officials. Some are retired Bangladeshi government officials, while others are serving officers," Foreign Minister AK Abdul Momen said in a newspaper interview a few months back. 

We asked Dr Iftekharuzzaman, Executive Director of Transparency International Bangladesh, for his take on the latest revelations. 

"The Pandora Papers show the truly global nature of corrupt practices, especially illicit financial transfers and accumulation of wealth in so-called safe heavens not only limited to offshore islands but also many other globally attractive destinations where legal loopholes facilitate such transfers," he replied. 

"It also shows that corruption is not limited to some unscrupulous criminals, but includes people in positions of power like politicians, businessmen and high-level officials. In each destination of illicit transfers there operate powerful syndicates of highly skilled law firms, real estate agents, accountants, regulators and major banking and financial institutions that collectively facilitate the secret deals," he added. 

At a time when the Covid-19 pandemic exposed how the governments around the world are failing to address the basic health needs of the population because they say they do not have enough money, the revelation of such secret wealth of the leaders are not just depressing, it shows how the loopholes in the systems are manipulated by the people who are indeed in charge of taking care of it. 

Besides, the Pandora papers also bring out the unfortunate reality that a large portion of the transfers is taking place out of the relatively poorer countries and landing in some of the world's richest countries or territories.