December 22, 2017

2017 Whistleblower of the Year Nominee — Paradise Papers Whistleblower(s)

This “Whistleblower Spotlight” features the Paradise Papers leaker(s), an unnamed whistleblower (or whistleblowers) responsible for shining a light on the widespread use of illicit offshore tax havens. The November 2017 exposé revealed where government officials, royalty, entertainers, and powerful corporations store their cash to avoid taxes.  The details are in 13.4 million documents, such as emails and presentations, handed over to German newspaper Süddeutsche Zeitung, the same publication that first obtained the Panama Papers. Süddeutsche Zeitung has not revealed its source.

In turning over the Paradise Papers, named for the exotic locales that characterize many offshore havens, the whistleblower or whistleblowers exposed a wide range of questionable transactions, leading to hundreds of investigations. Although smaller in size than the Panama Papers leak, the Paradise Papers leak is unprecedented for the sophistication of the dealings it exposed. These are just a sampling of revelations that have caught the media’s attention:

  • Queen Elizabeth II’s estate invested millions in an offshore portfolio, some of which went to BrightHouse, an entity accused of predatory lending.
  • U2’s Bono invested in a Lithuanian shopping mall by way of a tax shelter.
  • Big name companies, including Apple and Nike, engaged in aggressive tax avoidance.
  • President Trump’s Secretary of Commerce held a stake in a shipping company that does business with Vladimir Putin’s close associates.
  • Lewis Hamilton, of Formula One fame, avoided millions in taxes on his luxury jet.

Many of the leaked documents come from the same place, Bermuda-based law firm Applby, known for helping entities and high-net worth individuals establish and register companies in offshore jurisdictions. And a substantial number of the documents come from company registries of 19 offshore tax havens. Still others come from Asiaciti Trust, a Singapore-based corporate services provider.

What’s wrong with directing assets to jurisdictions with more favorable tax laws? In some cases, the practice is actually legitimate. But when a shelter is designed solely to hide assets and thus avoid taxes, it’s generally unlawful. Even more fundamentally, the Paradise Papers have drawn attention to the two-tiered system by which the rich and powerful avoid contributing to the economic wellbeing of their home nations, shifting the relative tax burden to the less savvy. As the Guardian put it, “[w]hy should taxes just be for the little people?”

For uncovering a staggering number of secret tax havens ranging from ethically questionable to downright illegal, we nominate the Paradise Papers whistleblower.

Vote here for the 2017 Whistleblower of the Year

*     *     *

If you would like more information or would like to speak to a member of Constantine Cannon’s whistleblower lawyer team, please click here.

Leave a Reply

Your email address will not be published.