April 4, 2016

The biggest leak of all time — The Panama Papers.

How big is it?
WikiLeaks (2010) 1.7GB
HSBC files (2015) 3.3GB
Luxembourg tax files (2014) 4.4GB
Offshore secrets (2013) 260GB
The Panama Papers (2016) 2.6TB
"Are all people who use offshore structures crooks?... Are some people who use offshore structures crooks?..."

67 comments:

Bob Ellison said...

You're on the trailhead of a Dr. Seuss story there, but the rhythm is off.

Who will illustrate the books?

YoungHegelian said...

If it's not against the laws of your country to use such tax havens, well, no, you're not a crook.

And even if it is, e.g., let's say in Putin's Russia, who the hell is gonna arrest those guys? Some cop who wants an all expenses paid one-way trip for himself & his family to lovely & rustic inner Siberia?

Now, for some folks it might be embarrassing if not illegal. Much like when some self-righteous muckety-muck gets caught with his membrum virile being somewhere other than with wifey-wifey.

MadisonMan said...

And it all fits on a couple of thumb drives!

I like the figures used in the article. Very nicely done.

zipity said...

"Are all people who use offshore structures crooks?... Are some people who use offshore structures crooks?..."

Yes. And Yes.

Nonapod said...

And all of it will most likely amount to absolutely nothing in terms of what will happen as a result. None of this is a surprise, just a confirmation. It also demonstrates why punitive levels of taxation on the ultra-wealthy is a fools errand.

Bob Ellison said...

The USA, with the world's greatest wealth pile and largest economy, is a piker in the bubble graph entitled "The Hidden Owners".

Nonapod said...

Yeah, it's no surprise that places like China and Russia represent considerably larger portions of the horde than the US. The less free the market, the more wealth stashers there will be.

Bob Ellison said...

Nonapod, yes, but even the UK, the BVI (British Virgin Islands, I assume), several countries in South America, and other un-named countries (Mexico? Turkey? difficult to tell by placement on the map) are bigger than the USA.

Makes me question the methodology. This is the Guardian, after all.

But also, the USA is more transparent and strict about money flows than almost any other country of note.

Ignorance is Bliss said...

Bob Ellison said...

But also, the USA is more transparent and strict about money flows than almost any other country of note.

Or, the leak was orchestrated by the CIA, who redacted information about their US paymasters, the evil Wall Street bankers.

Nonapod said...

@Ignorance is Bliss: Clearly it's all controlled by the Illuminati. Alex Jones told me so.

Lauderdale Vet said...

I wonder if there is any relevant data on any of the candidates in that data dump.

YoungHegelian said...

How the hell was a law firm so insecure that 2.6TB of data walked out the door? What, did someone waltz in off the street & say "Hey, shyster, can I just go in and copy off your RAID array to these here USB drives? It'll just take me a couple of days...."

There's not a lot of ways right now that one can quickly & discreetly copy off 2.6TB.

Virgil Hilts said...

For obvious reasons, China is heavily censoring discussions of the leaked data -- http://www.bbc.com/news/world-asia-china-35957235. "China's Communist officials are discouraged from profiting from their ruling positions, and their family members are not supposed to profit from their ties, according to the Party's constitution." LOL.
My guess is that China is where the leaks are going to cause the most trouble.

Curious George said...

My money is in Green Bay.

Bill Peschel said...

Irony alert: The Guardian is among those named in the papers as using offshore accounts to avoid paying taxes.

Amexpat said...

Looks like the first casualty of this will be the the Prime Minister of Iceland.
http://icelandmonitor.mbl.is/news/politics_and_society/2016/04/03/iceland_pm_walks_out_of_interview_after_tax_haven_q/

DavidD said...

" 'Are some people who use offshore structures crooks?' "

Some people who do anything are crooks, independent of what they're doing, so isn't that kind of an open question?

Edmund said...

@zipity

Not everyone that uses offshore banks is a crook. The husband of a former coworker had bank accounts in Luxembourg, the UK, and elsewhere. Why? He was an author of scholarly books and they were published overseas. It was cheaper for him to have the royalties deposited in local banks and not pay exchange and overseas check fees. He reported all the income to the IRS each year and paid all taxes. He used the money when he went overseas to conferences, as he could withdraw money in the local currency with an ATM card. (This was in the late 70s, when banking was much more local.

That said, I doubt that all, or even most of these accounts are on the up and up.

PB said...

Crook/not Crook is such a binary distinction. How about US companies that set up a subsidiaries in non-tax locations, sell their intellectual property (patents, trademarks, etc) to those subsidiaries for a pittance, and then license it back to the US parent for high fees that make the US operation almost profit-free and transferring large amounts of cash offshore? All legal. Double Irish with a Dutch sandwich.

traditionalguy said...

Where your money is, there is your heart.

No wonder pro USA nationalism has been thrown out by the Smart Set.

Their hearts are in Central America...but it is all one planet they say.

GlobalWarming loot is coming to the same offshore hidden investments soon while the Americans pay $1,000 a month more for electric bills that flows in the same accounts "to save the Planet" from cartoon BS.

And then along came Donald Trump.

mccullough said...

Nice work by the CIA. Well done

Big Mike said...

The news anchors on Russia Today were angry (i.e., were expressing suitable anger while reading from their teleprompters). Apparently Putin was a target of the Panama Papers, but his name never appears -- three people alleged to be longtime friends are on the list, but not him.

Meanwhile the list include Kofi Annan's son, David Cameron's father, the King of Saudi Arabia, and apparently lots of other folks.

No American politicians on that list. Since George Soros is supposed to have funded the project, so are Americans not there because all of the Americans they found are prominent Democrats? Or are Americans unusually honest? No, I don't think so either.

n.n said...
This comment has been removed by the author.
Big Mike said...

@MadMan, you'd have to buy $2000 worth of thumb drives. Cheaper to buy an external hard drive, which are much cheaper.

n.n said...

Cash of the titans.

Oh, well. To each their own. This is not an issue in and of itself.

MadisonMan said...

I'm not sure it would cost that much. Every time I buy a flash drive (not often) I'm just amazed at how prices drop and how much more they can hold.

)old man voice on(

I remember when a 1GB flash drive was >$100!!!

)old man voice off(

But yes -- something like this (external hard drive from Amazon) -- is incredibly cheap now! (Don't click that link though, buy it through the althouse portal ;) )

Jason said...

I can think of a lot of legit reasons to hold an offshore bank account. A gazillion people do it to deter lawsuits. Sweet Cakes by Melissa should have kept their money in a foreign account. Would have made it not so worth it to sue them. The Cayman Islands isn't going to honor a judgment from a U.S. court to sign over their assets to those assholes.

I might want to hedge against the U.S. dollar by holding CDs or other assets in foreign denominations.

I might have a child attending college in Switzerland. (I'm looking at YOU, John Kerry!)

I might have business operations overseas, and may want to make it convenient for foreign clients, customers, vendors and stakeholders to make or receive payments without paying inordinate fees or having to scratch their heads figuring out currency conversions.

For example, if I were to write a book entitled, oh: "IGNORAMUSES: WHY DUMBASS BONE-IGNORANT LIBTARDS ASSUME EVERYONE WITH A FOREIGN BANK ACCOUNT IS A CROOK," I'd probably want to establish an account in overseas markets to make it easy for people in, say, Canada to buy the book online, or subscribe to my newsletter.

Eustace Chilke said...

I care little about foreign leaders looting their countries. I assume that this is de rigueur in most places. Or about ordinary, legal, and commendable use of tax shelters.

Are the Clintons sheltering offshore money? (most likely) Or other U.S. politicos? (also would not be surprising) Of mild interest, which Hollywood commies are dodging the Bern of confiscatory taxes?

Something stinking is surely buried in that data dump. We'll see.

Lem said...

What Kanye West said coming out of a men's room?

Gahrie said...

It is almost as if people thought that their money actually belonged to them, and was theirs to do with as they wished.

Silly people, our money belongs to the government, they just let us play with some of it for a while.

Rusty said...

zipity said...
"Are all people who use offshore structures crooks?... Are some people who use offshore structures crooks?..."

Yes. And Yes.


Nope.

traditionalguy said...

Maybe they will soon ID the DC Madam's stashed account with a chunk of Cheating Ted's money still sitting in it.
That is such a good story that the Inquirer can just guess at it and run it like Heidi did when she filed for Divorce.

LYNNDH said...

Divorce Lawyers are licking their chops over this. Was BO redacted?

Alexander said...

You're a crook if you made the money crookedly.

If you're only 'crime' isn't wanting to dole out cuts of your efforts, then you're not a crook.

Unless you believe the above for thee, but not for me. Then screw you.

buwaya said...

" Sweet Cakes by Melissa should have kept their money in a foreign account."

Not worth it by a long shot. The IRS would jump on it with both feet.

JSD said...

This money didn’t appear out of thin air. This is money that came out of your pocket. Thieves stealing from legitimate activity and then re-emerging with fortunes dressed with respectable provenance. All of this loot originated in America and Western Europe. Foreign trade, oil and gas, drug money, third world manufacturing. Americans overpaid for goods and services; people were robbed of their livelihood; foreign factory workers were enslaved; and the thieves become billionaires with a Gulfstream jets. There is no point in having global trade and economic systems if a tiny minority is able to fly above the rules that bind the rest of us.

Sammy Finkelman said...

This leak may have bene about Putin:

http://www.thedailybeast.com/articles/2016/04/04/putin-s-panama-papers-caper.html

Bushman of the Kohlrabi said...

I wonder how Hillary's leaks measure up.

On second thought, don't answer that.

Big Mike said...

@MadMan, a 1TB thumb drive lists for $665, and you'd need three. I know of at least one 512 GB thumb drive for sale for a bit under half that, but you'd need six and that's a pretty full pocket. You could get by with eleven 256 GB thumb drives, but with that many you'd probably mislay one or two.

If I put on my old man voice I'd remind you that the basic unit of measure used to be 80 bytes on a punch card.

8-P

Bob Ellison said...

JSD said, "This money didn’t appear out of thin air. This is money that came out of your pocket."

True in spirit, but I would write it thus:

"This money came from thin air, from value that was stolen from you."

Money and value are not the same thing. Most people have no idea.

Jason said...


"Sweet Cakes by Melissa should have kept their money in a foreign account."

Not worth it by a long shot. The IRS would jump on it with both feet.


Why? They aren't accused of tax fraud.

And the IRS can't force a foreign bank to sign assets over to them, any more than the State of Oregon.

Nonapod said...

Flashdrives are slowly getting there but spinning rust still get you the most bang for your buck. As you can see you can get 4TB on a drive thats slightly larger than a wallet.

Bob Ellison said...

If I were some Sprite that could get access to that central American data center (which may well be located in Seattle or England or Malaysia or wherever), then figuring out how to transfer and store a few terabytes of data would be the least of my worries.

Bob Ellison said...

Physical size does not matter. Speed still matters a little bit (heh), but not much. If you want to download Eurasia, you can do it, as long as you have the keys and a few hard drives the size of a wallet, as Nonapod notes.

JPS said...

Gahrie, 12:51:

"Silly people, our money belongs to the government, they just let us play with some of it for a while."

No, no, you've got them all wrong. Their attitude was best stated by Sen. Warren, who I'm surprised won't be this year's Democratic nominee:

"Good for you, keep a big chunk of it."

The definition of "big," of course, to be determined by their needs, their political ambitions, and their view of the ideal America, not, of course, by yours.

MadisonMan said...

Punch cards were done away with (I was a CompSci major) when I was a sophomore. Wow was it nice not to have to carry around a whole deck. The new problem was waiting for a terminal to open up.

My boss still has a drawer full of programs on punch cards, using the punch cards for note paper.

Bushman of the Kohlrabi said...

Punch cards were done away with...

The best thing about punch cards was that they could be heaved into the air in total frustration when you just couldn't get that major program to run. Terminals took away that fun.

Sammy Finkelman said...

I think they could use an external hard drive that plugs into a USB port, too.

aritai said...

seems the list is mostly leftists or politicians fleecing their people. Taxes and obeying the law are for the little people and the conservatives.

Sammy Finkelman said...

Punch cards were used by the New York Public library and the Brooklyn Public Library to keep track of books checked out in the 1970s and the 1980s. The card was pre-punched.

David said...

Be cautions. Remember the Hitler Dairies.

David said...

>No American politicians on that list. Since George Soros is supposed to have funded the project, so are Americans not there because all of the Americans they found are prominent Democrats? Or are Americans unusually honest? No, I don't think so either."

American politicians have no problem getting rich while obeying the law. They designed the system that allows them to cash in, and they wrote the laws that pretend to regulate their conduct in and out of office. For the most part American political corruption is entirely legal. Our legislators are not without creativity when they find a topic that really interests them. For recent lefty examples consider Clinton speeches (both Clintons), John Edwards no work $500K "consultancy" with Goldman Sacs, Tom Demint's post political advocacy groups, Al Gore in everything he does and every governor of Illinois since the invention of the telephone. Etc Etc Etc.

MadisonMan said...

The best thing about punch cards was that they could be heaved into the air in total frustration when you just couldn't get that major program to run.

Far better to knock "accidentally" someone else's card deck onto the floor.

narciso said...

yes, it's like with the dc madam's list, or ashley madison, a very selective release,

Chuck said...

Professor Althouse;

You and I both know that the world press will hail this exposure as the triumph of a free press over corruption and tax fraud.

I wondered if the notion of a hacker apparently invading a law firm's files to expose client confidences caused you any concern?

JamesB.BKK said...

Some perspective? This story is about people who live off the skim taken from others while insisting the others report and pay the skim. It is not about people just storing their wealth rightly obtained or business owners, managers, or workers who actually produce things that other people wish to buy without coercion and who wish to keep privately the fruits of their efforts.

Gotta say the members of the crowd that perceive any foreign activity as somehow evidence of criminal activity are undesirable to have as fellow citizens. Avoiding taxation or not reporting financial information is a victimless "crime", if there is a crime at all, created only by the desperate welfare states fairly recently, with most credit to the government of the Land of the Free with its odious taxation of worldwide income and now global reporting by financial institutions under FATCA (thanks 2010 Democrat Congress and Obama!). Activity toward not giving up all financial privacy to these state and parastatal predators and parasites should not be attacked by their fellow citizens, especially without any evidence whatsoever. These are not folks with pockets to be picked by your representatives. Marx was right that there is a class struggle. He got the classes wrong. They are the state and its predatory and parasitic clients, and the productive people (including capital and labor on the same side) on which the former prey.

Phunctor said...

+1 internet for Marx was right that there is a class struggle. He got the classes wrong. They are the state and its predatory and parasitic clients, and the productive people (including capital and labor on the same side) on which the former prey.

jdniner said...

I'm cynical about the ability of the media to work without a strong slanted bias. If they can publish a complete Cliff Notes version for the release then I might reconsider.

Bob Ellison said...

How about Ben and Jerry's?

Put on them Birkenstocks and give up profit and wealth for the peeps!

David Ragsdale said...

If I had the cash, I'd start a small bank that operated entirely in paperwork & nothing digital.

Moneyrunner said...

This is proof that the US is considered a safe haven by people who want to have a a safe place to store their loot just in case the locals revolt. Most of the political leaders who stashed money in foreign accounts live in unstable places where a revolt could leave them penniless. OTOH the Clinton Crime family decided to hide their loot in plain sight, in a tax free foundation that will provide them and their descendants with wealth for the rest of their lives. If Trump wins the Presidency perhaps he could take the tack that Connecticut is taking by taxing over-funded tax shelters like the Yale endowment. That would warm the cockles of my heart, take back some of the money that big Academia is stealing from students, and teach the political class that the money they are stealing is not safe. A trifecta.

Rusty said...

JPS said...
Gahrie, 12:51:

"Silly people, our money belongs to the government, they just let us play with some of it for a while."

No, no, you've got them all wrong. Their attitude was best stated by Sen. Warren, who I'm surprised won't be this year's Democratic nominee:

"Good for you, keep a big chunk of it."

The definition of "big," of course, to be determined by their needs, their political ambitions, and their view of the ideal America, not, of course, by yours.


When congress is arguing about how much to tax you. They aren't trying to determine how much they're going to take. They're arguing to determine how much they're going to let you keep.

JamesB.BKK said...

Dan Mitchell as usual has his head on straight:

"Firms like Mossack Fonseca are merely just the latest stand-ins and proxies for a much wider campaign being waged by left-wing governments and their various allies and interest groups. This campaign is built around aggressive attacks on anyone who, for any reason, seeks to legally protect their hard-earned assets from confiscatory tax policies. …a cabal of governments…has decided not to compete…instead simply seeking to malign and destroy any entity, individual or jurisdiction that exists that deprives them of tax revenue to which politicians greedily believe they are entitled. As usual, the media outlets running these perennial “exposés,” usually at the bidding of OECD bureaucrats (who ironically get tax-free salaries)."

https://danieljmitchell.wordpress.com/2016/04/04/another-attack-on-tax-competition-panama-papers-is-a-non-controversy-controversy/

Still we circle the drain while some in the crowd elect these destructive people, repeatedly.

Bob Ellison said...

Moneyrunner, why do the Clintons do it?

JamesB.BKK said...

Federal “law enforcement” stole outright from US citizens far more last year using civil forfeiture laws than anything approaching what Mr. Putin here stands (without proof) in this poorly drafted article accused of.

Rusty said...

"Money and value are not the same thing. Most people have no idea."

Hence Bernie Sanders.

aritai said...

From this crater's rim even at low resolution, it appears the U.S. doesn't need such foolishness and reliance on gangsters who just might run off with more than a fraction. The U.S. has a large system to avoid taxes, with slightly less graft. Non-Profits, Trusts and special treatment of capital gains. Occurs to methat more than Wall Street's special favors are in pTb's sights. Oh right. Paying down 20T$ in debt will take more than Dept. of Commerce, Treasury or Labor's funny numbers. Who knew imaginary numbers were real? University graduates eh? Could pay more and not get less.