The Crazy Secretive World of Tax Havens

An employee of Jetpack Cayman demonstrates a new water sport that’s now available on the island. A 2000-cubic-centimeter motor pumps water up through the jetpack, propelling the client out of the sea.

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE

It’s hard enough for outsiders to know what’s even going on in tax havens, those notoriously secretive places where taxes are levied at absurdly low rates. Photographing what they look like is almost impossible—but Paolo Woods and Gabriele Galimberti have done it in The Heavens, which Dewi Lewis published in September.

“I’ve worked as a war photographer in Afghanistan and Iraq. I worked in Iran for about five years. I’ve worked on the Chinese in Africa, who are more than press-shy. But no subject was as difficult as this one,” Woods said.

Tony Reynard (on the right), chairman of the Singapore Freeport, and Christian Pauli, general manager of Fine Art Logistics NLC, in one of the high-security vaults of the Singapore Freeport, one of the world’s premier maximum-security vaults, where billions of dollars in art, gold, and cash are stashed.  

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE

Alain Craig (on the right) and his friend Anthony Lawson, with Craig’™s convertible Maserati. Lawson is a Caymanian real estate agent, and Craig, who is from Britain, works in the islands’™ thriving hedge fund industry. They have come to visit Al Thompson, who is standing in the background in front of his house. Thompson is the biggest importer of building materials to the Cayman Islands.

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE

Woods and Galimberti, like most people, knew nothing about how tax havens worked when they decided to embark on this investigation. Over three years, they traveled to 13 destinations—including unlikely suspects like Delaware and Luxembourg—looking for answers and images. Both proved elusive. Their first challenge was conceptual: How could they translate into images a situation that exists mostly abstractly, as a series of laws and financial transactions? One way was to spend time with the wealth managers, lawyers, bankers, and politicians who make those things possible. But few query letters they sent were answered, and most responses they did receive were rejections.

“You have to consider that a big part of what happens in a tax haven is completely legal. It might not be moral, but it’s completely legal. But even if it’s legal and even if you approach people very straightforwardly, there are a lot of people who will say no, who don’t want to speak with press. There’s a very big fear of negative press,” he said. 

Andreas Ugland and family are depicted in a large oil painting hanging at the entrance of Mr. Ugland’™s œCayman Motor Museum€. The museum houses his unique collection of Ferraris, Rolls-Royces, Bentleys, and vintage motorbikes. Mr. Ugland, a billionaire born in Norway, acquired Caymanian citizenship in the 1990s. He is chairman of Ugland International Holdings and runs a number of companies and banks in the Cayman Islands, the U.S., and Europe. At the center of the painting is the œUgland House, a building where more than 19,000 companies are registered. It has become such a symbol of tax avoidance that President Obama has stated that “either this is the largest building in the world or the biggest tax scam on record.” 

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE

The lobby of Ernst & Young’s headquarters in London. E&Y is one of the “Big Four” audit firms. It has 190,000 employees and more than 700 offices in over 150 countries. It’s the third-largest professional services firm in the world by aggregated revenue. The “Big Four” (PwC, Deloitte, KPMG, and E&Y) are often accused of being the backbone of offshore finance and aggressive tax avoidance strategies. They collectively audit 99 percent of FTSE 100 companies. 

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE

To supplement the images of individuals they managed to track down, they photographed what was readily and publicly available—walls of P.O. boxes, luxurious swimming pools, and high-end recreational activities—as symbols, requiring viewers to read the nefarious subtext underneath.

Tax havens, Woods readily admits, are not sexy subjects. It’s a complicated system to understand, even if, for those who use them, they’re easy to access, as the pair found out when they effortlessly registered a company in Delaware as a test. Many presume havens only affect super wealthy individuals and corporations, but Woods and Galimberti caution against that outlook: They want readers to see that the excessive success of some results in the suffering of others. 

“Those billions of dollars which do not go in the reserves of each country is money which is stolen from you, from public services, from schools, hospitals, roads, police, whatever. If you have a friend who’s a nurse and she barely makes ends meet because her salary is very low, some of the people you can thank are those who manage to reduce their taxes lower than what normal people would pay. We’re all concerned very directly by what tax havens do.”

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A premium casino for high rollers is situated on the 66th floor of the Trump Ocean Club. It has its own restaurant, bar, and swimming pool, where one can swim with panoramic views of the city. A great number of the apartments in the skyscrapers of Panama are dark because they are not occupied. This is the result of a real estate bubble that most observers agree is fueled by drug money from Colombia and Venezuela, laundered through property in Panama.

Copyright Paolo Woods & Gabriele Galimberti / INSTIITUTE