Loopholes, Lies and Luxury Properties: The Pandora Papers Reveal Corruption of World Leaders

The Pandora Papers leak is one of the biggest information leaks conducted in history. It is made up of almost twelve million pieces of evidence, including documents, images, emails, and spreadsheets, compiled by more than six hundred journalists in 117 countries. It took months of investigation of fourteen different sources and reveals unsavory tax and purchasing activity by world leaders and influential businesspeople. The papers were published by the International Consortium of Investigative Journalists (ICIJ).

Names included in the papers have shocked people all over the world, and most people involved have declined to answer questions about their suspicious behavior. One such is King Abdullah II, the ruler of Jordan, who, while his people relied on foreign aid just to survive, bought more than $106 million worth of luxury homes in the U.K. and the U.S., through shell companies registered in tax havens.

Another is Azerbaijani President Ilham Aliyev and his family. It has been revealed that they have made almost £400 million from selling properties in the U.K., which they bought using the money from eighty-four previously unknown offshore companies registered in the British Virgin Islands. One of the properties was even sold to the Queen’s crown estate.

The Prime Minister of the Czech Republic, Andrej Babis, after ruthlessly hunting down those in his country accused of engaging in tax avoidance schemes, bought a $22 million chateau in the French Riviera using money funneled through offshore companies.

The Nicos Chr. Anastasiades law firm, originally founded by its namesake Nicos Anastasiades, the President of Cyprus, was accused of “hiding the assets of a former Russian senator behind fake beneficial owners.” The president denies any current involvement in the law company, but still owns shares in the company, and so would benefit from any profit made from these activities.

Former U.K. Prime Minister Tony Blair and his wife Cherie did not pay stamp tax on their £6.54 million London property, after acquiring an offshore company through which to pay for it. This saved them £312,000 in tax, and although they claim they never actively avoided paying tax, it seems unlikely that they thought this was a normal and acceptable way to buy property.

Ukrainian president Volodymyr Zelensky has been found to have owned a network of offshore companies in the British Virgin Islands, Cyprus, and Belize, which, despite handing his shares to his chief aide Serhiy Shefir around the time of his election, he and his family continue to receive money from this setup. The companies have been used to buy expensive property in London, as seems to be a popular purchase for those using these types of tax avoidance schemes.

After an impassioned fight against corruption in his government that ended up with him leading the country, Prime Minister of Pakistan Imran Khan promised to “establish supremacy of the law” and that “accountability will start with (him), then (his) ministers, and then it will go from there.” The Pandora Papers, however, have revealed that members of Khan’s inner circle, including his finance minister Shaukat Fayaz Ahmed Tarin, own an array of offshore companies and trusts that have hidden millions of dollars.

Another leader who had campaigned enthusiastically for transparency and honesty surrounding the wealth of the elite is Uhuru Kenyatta, the president of Kenya. After claiming that “too many Kenyans live in poverty and too many officials loot the country’s public resources,” Kenyatta hid his family’s half-a-billion-dollar fortune made through offshore companies and foundations in Panama and the British Virgin Islands.

One of the most unfortunate aspects of the Pandora Papers revelations is that none of these activities are illegal. While tax evasion is purposely going outside of the law to avoid paying tax, tax avoidance, which is what the perpetrators in the Pandora Papers utilized, “involves bending the rules of the tax system to try to gain a tax advantage that Parliament never intended. It often involves contrived, artificial transactions that serve little or no purpose other than to produce this advantage. It involves operating within the letter, but not the spirit, of the law.”

If the system were to be fair to everyone, tax avoidance would also be made a criminal offense. It is a loophole through which the rich can avoid contributing to the society that made them so and force the poor to pay more since these avoidance schemes are only beneficial when working with large sums of money. Unfortunately, it is unlikely that this change will ever come about. As the Pandora Papers have shown, it is often the leaders and decision-makers who benefit from tax avoidance, and no leader is noble enough to deprive themselves of those precious extra millions that they have no qualms over depriving their people of.

It is incredibly important that leaks such as this continue to happen. If you have any evidence that may provide information that might be of public concern, you can submit this to the ICIJ via this link. You never know, maybe that could be the thing that topples elite corruption for good.