The Panama Papers were tiny compared with this. A massive leak of almost 12 million files from 14 firms around the world exposes how 35 world leaders and hundreds of politicians, billionaires, and celebrities, among others, use the offshore system to hide cash. The files, dubbed the Pandora Papers, were obtained by the International Consortium of Investigative Journalists, which worked with 600 journalists from 150 media outlets in 117 countries to dig through the documents and find stories.
The biggest bombshell from the files—including 6.4 million documents, almost 3 million images, more than a million emails, and almost 500,000 spreadsheets—is how they reveal the financial dealings of 35 current and former world leaders. King Abdullah II of Jordan, for example, spent more than $106 million on luxury homes. Others singled out in the files include former U.K. Prime Minister Tony Blair, Czech Republic Prime Minister Andrej Babis, Kenyan President Uhuru Kenyatta, Ecuador’s President Guillermo Lasso, and people close to Pakistani Prime Minister Imran Khan as well as Russian President Vladimir Putin. A Russian woman who reportedly had a child with Putin, for example, bought a luxury apartment in Monaco. A childhood friend of Putin’s also appears in the documents.
Another big revelation from the leak is not really about the names but rather how it shines a bright spotlight on the way the United States has become a top offshore destination for the rich and powerful to hide their assets. The United States is such an appealing destination for the cash that many have moved their money from other better-known tax havens to the United States. South Dakota in particular has emerged as a top destination for foreign assets. “Over the past decade, South Dakota, Nevada and more than a dozen other U.S. states have transformed themselves into leaders in the business of peddling financial secrecy,” ICIJ writes. And regulators and law enforcement haven’t really caught up as they continue to focus their efforts on the better-known tax havens such as the Bahamas and the Cayman Islands. The revelation will “likely … prove embarrassing for the U.S. president, Joe Biden, who has pledged to lead efforts internationally to bring transparency to the global financial system,” notes the Guardian.
Anti-poverty group Oxfam praised the investigation on Sunday, calling it “another shocking exposé of the oceans of money sloshing around the darkness of the world’s tax havens.” And that money that is hidden away has very real consequences. “This is where our missing hospitals are,” Oxfam said in a statement. “This is where the pay-packets sit of all the extra teachers and firefighters and public servants we need. Whenever a politician or business leader claims there is ‘no money’ to pay for climate damage and innovation, for more and better jobs, for a fair post-COVID recovery, for more overseas aid, they know where to look.”
The revelations quickly reverberated around the world and could have real consequences for world leaders. In Pakistan, the leader of a political party called for the resignation of Prime Minister Imran Khan after the revelation that members of his government hold lots of cash offshore. Khan has said he welcomes the investigation and vowed to investigate all of the country’s citizens who appear in the documents.