The secret records obtained by ICIJ lay bare an extraordinary range of people using offshore hideaways.
They include US dentists and middle-class Greek villagers as well as families of despots, Wall Street swindlers, eastern European and Indonesian billionaires, Russian executives, arms dealers and a company alleged to be a front for Iran’s nuclear-development programme.
The leaks illustrate how offshore financial secrecy has aggressively spread around the globe. The records detail offshore holdings in more than 170 territories; this represents the biggest stockpile of inside information about the offshore system ever obtained by a media organisation.
To analyse it, ICIJ collaborated with reporters from the Guardian and the BBC in the UK, Le Monde in France, S üddeutsche Zeitung and Norddeutscher Rundfunk in Germany, the Washington Post , the Canadian Broadcasting Corporation (CBC) and 31 other international media partners.
Eighty-six journalists from 46 countries used both hi-tech data crunching and traditional reporting to sift through emails and account ledgers covering nearly 30 years.
“I've never seen anything like this. This secret world has finally been revealed,” said Arthur Cockfield, a law professor at Queen’s University in Canada, during a CBC interview.
Offshore’s defenders say that most users are legitimate. Offshore centres, they say, allow people to diversify investments, create international ventures and do business in entrepreneur-friendly zones without red tape.
“Everything is much more geared toward business,” David Marchant, publisher of OffshoreAlert, an online journal, said. “If you’re dishonest, you can take advantage of that in a bad way. But if you’re honest you can take advantage of that in a good way.”
The vast tide of offshore money can disrupt economies. Greece's fiscal disaster was exacerbated by offshore tax cheating and in the Cyprus crisis, local banks’ assets were inflated by waves of cash from Russia.
ICIJ’s 15-month investigation found that, alongside perfectly legal transactions, the secrecy and lax oversight offered by the offshore world appears to allow fraud, tax-dodging and political corruption to thrive.
Anti-corruption campaigners argue that offshore secrecy forces citizens to pay higher taxes to make up for vanishing revenues, while anonymity makes it difficult to track the money.
A study by James S Henry, former chief economist at McKinsey & Company, estimates that wealthy individuals have $21-$32 trillion tucked away in offshore havens – roughly equivalent to the size of the US and Japanese economies combined.
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