Friday, August 12, 2022

Pandora Papers exposed the offshore structures of World leaders


Zubair Yaqoob
The author has diversified experience in investigative journalism. He is Chief content editor at

At least 35 current and former world leaders, including former British Prime Minister Tony Blair and King Abdullah of Jordan, have been found to use structures in notorious tax havens such as the British Virgin Islands. That’s what the Pandora Papers reveal, millions of leaked documents. It also features world-famous stars such as Elton John, Ringo Starr, and Shakira.

In 2017, former British Prime Minister Tony Blair and his wife Cherie bought a building in London from a minister in Bahrain. However, the couple did not buy the $8.8 million Victorian building themselves, but the shares of a PO Box company in the British Virgin Islands that owned it. In this way, the couple avoided about £312,000 in taxes. Cherie Blair, who now has her law firm in the building, says her husband was not involved in the deal. She also didn’t want to own a PO box company in the Virgin Islands, she says, and “it has now closed down.

It is just one example of the shadowy constructions that the Pandora Papers reveal of 35 (ex-) heads of state and government and more than 330 politicians and top officials in more than 90 countries.

Czech Prime Minister Andrej Babiš appears to have bought a castle worth more than 19 million euros on the French Riviera via mailbox companies in Monaco, which he never reported as a government official.
King Abdullah of Jordan, one of the poorest countries in the Middle East, also bought 14 luxury homes in the United Kingdom and the United States, including on the coast of Miami, through PO Box companies in the British Virgin Islands. Together they are worth 106 million dollars.
The presidents of Ukraine, Kenya, and Ecuador are named in the Pandora Papers as well.

Czech Prime Minister Andrej Babiš appears to have bought a castle worth more than 19 million euros on the French Riviera via mailbox companies in Monaco, which he never reported as a government official. Ecuador’s President Guillermo Lasso hid bank accounts through a shady foundation in Panama.

The King of Jordan and his 36 companies

Among the users of the companies uncovered by the Pandora Papers, notably appears King Abdullah II of Jordan. To help him secretly acquire 14 luxury homes worth over $ 106 million, in the US and UK, an English accountant based in Switzerland worked with lawyers from the British Virgin Islands. Of those residences, the King bought a $ 23 million property overlooking a California surf beach from a company based in the British Virgin Islands. For this, 36 fictitious companies were created between 1995 and 2017.

Internal emails show that ALCOGAL and its Swiss advisor have discussed how to avoid disclosing the monarch’s name to authorities in the British Virgin Islands. In these documents, the offshore advisers use a code name to designate it by speaking of: “You know who”.

Tony and Cherie Blair

The Pandora Papers also shed a harsh light on certain statements made by other high personalities. In February 2021, the Tony Blair Institute for Global Change called on policymakers to tax land and houses more heavily. As early as 1994, while campaigning for the leadership of the British Labor Party, Tony Blair himself regretted that wealthy person escaped tax: “For those who can employ good accountants, the tax system is a haven. of scams, advantages, and profits,” he said during a speech in the West Midlands, England. “We must not make our tax rules a playground for tax abusers who pay little or nothing while others pay more than their share. 

The Pandora Papers revealed that in 2017, Tony Blair and his wife Cherie became owners in London of a Victorian building worth $ 8.8 million where they housed the law firm of Cherie Blair. But they did not buy the building. They bought out the shares of the British Virgin Islands company which owned the property, and which was owned by the family of Bahrain’s Minister of Industry, Trade and Tourism, Zayed bin Rashid Al Zayani. By taking control of this company rather than buying the building itself, the Blairs benefited from a legal arrangement that saved them from having to pay more than $ 400,000 in property taxes in England. Solicited, Cherie Blair said her husband was not involved in the transaction, and that her aim was to comply “with the UK tax and regulatory regime “. As for the Al Zayani, they claim that their “companies have complied with all British laws past and present “. In addition, another ex-politician closer to us is quoted in the Pandora Papers: Dominique Strauss-Khan, who created a company in the United Arab Emirates.

Wopke Hoekstra

Wopke Hoekstra, minister van Financiën

Wopke Hoekstra, Minister of Finance in the resigning Dutch government, also appears in the Pandora Papers. From 2009 he bought shares of Candace Management Limited in the British Virgin Islands. That mailbox company used a Dutchman, Jeroen Harderwijk, for its safari parks in Africa. During a crisis period, Harderwijk would have asked sympathizers such as Hoekstra to buy shares from him.

Hoekstra says he was unaware that the company was based in the British Virgin Islands and that he sold the shares in October 2017, just before he became Chancellor of the Exchequer. As a senator from 2011 to 2017, he did not declare participation, but that would not have been an obligation. He would have bought shares for only 26,500 euros, on which he made 4,800 euros profit.

Elton John, Claudia Schiffer, Ringo Starr, Julio Iglesia and Shakira

World-famous stars such as pop legend Elton John, supermodel Claudia Schiffer, Beatles drummer Ringo Starr, Spanish singer Julio Iglesias and Colombian pop diva Shakira are also featured in the leaked documents.

They all use PO box companies in places like the British Virgin Islands, where you don’t pay taxes and where you can set up screen constructions.

Ringo Starr, 81, used construction in the Bahamas to buy real estate. He also has accounts in Panama, including for his inheritance and income from royalties and performances.

Claudia Schiffer (51) operates several PO Box companies in the British Virgin Islands. But the supermodel claims to meet all her tax obligations in the UK, where she lives.

Shakira was already in 2018 discredited for tax evasion. A Spanish judge ruled in July that there is sufficient evidence that Shakira evaded more than 14 million euros in taxes between 2012 and 2014. However, according to the leaked documents, she still set up new offshore structures in 2019. In the meantime, Shakira says that she is in order with her taxes.

The Spanish singer Julio Iglesias (78) also appears to be hiding behind a whole series of constructions in the British Virgin Islands. The same goes for 74-year-old Elton John. He also denies that they were founded for tax reasons.

In addition to those well-known names, we also found criminals in the same tax havens, ranging from arms dealers to an Italian mobster like Raffaele Amato, who is linked to countless murders and who inspired the movie ‘Gomorrah’. The mobster, who is serving a 20-year prison sentence, used a fencing company to buy land in Spain.

Svetlana Krivonogikh, the alleged mistress of Russian President Vladimir Putin

133 billionaires from 45 countries, including 46 Russian oligarchs, also appear in the Pandora Papers. Like two American technology billionaires, Robert Smith and Robert Brockman, who was previously discredited for one of the largest tax frauds in American history.

In the Pandora Papers, we find a striking number of Russians, accounting for 14 percent of all mailbox companies about which data has been leaked. Although Russian President Vladimir Putin has already openly fulminated against the use of such offshores by Russian businessmen, it appears that his confidants are also making great use of them to enrich themselves. An alleged mistress of Putin, who may even have a daughter with him, was given a €3.6 million apartment in Monaco in the fall of 2003 through such a PO box company.

Putin’s chief propagandist, Konstantin Ernst, secured a 23 percent stake in a billion-dollar Russian real estate privatization deal through construction in the British Virgin Islands. That happened on the day that Ernst brought the opening ceremony of the Olympic Games in Sochi to a successful conclusion in early 2014. He also received a shadowy loan through a bank in Cyprus linked to the VTB, a bank controlled by the Kremlin.

Several political actors from Lebanon in the leak

The current Prime Minister, Najib Mikati, his predecessor, Hassan Diab, as well as the governor of the central bank, Riad Salameh. Mr. Diab did not respond to questions from the ICIJ. Mr. Salameh assured the ICIJ that he has declared all his assets and that he has subscribed to the tax laws of Lebanon. Mr. Mikati’s son, Maher, told the ICIJ that it is common practice for the Lebanese to use overseas companies “given the ease of the incorporation process” and not to avoid paying fees. taxes.

Former Formula 1 champion Jacques Villeneuve

Jacques Villeneuve owned companies and trusts in tax havens even before he started his Formula 1 career, the Pandora Papers reveal.

Quebec millionaire Firoz Patel

Firoz is currently serving a three-year prison sentence in the United States after pleading guilty to conspiracy, money laundering, and unlicensed Internet financial services exploitation. The Montrealer and his brother made a fortune on the web thanks to the Payza and AlertPay platforms, which processed more than $ 250 million in payments from criminal activity. The Pandora Papers reveal that Firoz Patel flew to the United Arab Emirates to acquire an offshore company as the two brothers were under investigation. From prison, he told the Toronto Star that it was pursuing legitimate ends, to conduct business in Asia and that it had nothing to do with the financial services he offered on the Internet.

90+ advisers in Switzerland played a crucial role

Millions of documents have been leaked at 14 offices with locations stretching from the Caribbean and Persian Gulf to the South China Sea. These are TridentTrust, Alcohol, Asiaciti Trust, Alpha Consulting, Cititrust, DAD Law, Fidelity, GDG, OMC, Il Shin, SFM, AABOL, CCSL, and Commence BVI. They can set up a trust or other PO box construction for you for a few hundred or thousands of euros.

More than 90 advisers in Switzerland play a crucial role. They direct their international clients to offices in tax havens. The Swiss advisers have to follow less strict rules than banks when screening customers and the risks of money laundering. The leaked documents show that between 2005 and 2016 at least 26 Swiss offices helped clients who were later discredited for money laundering or financial crime.

The Pandora Papers also prove the hypocrisy of the United States. American states such as Delaware, Alaska, and South Dakota have been emerging as new refuges for screen constructions for some time. They are taking over from exotic places like the Bahamas or the Cayman Islands, which have been under attack for years. According to the leaked documents, hundreds of millions of dollars have moved from notorious tax havens to South Dakota. Among others, the former Vice President of the Dominican Republic, Carlos Morales, discreetly moved wealth from the Bahamas to South Dakota.

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