The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Where Billionaires Hide Their Money

Apr 11, 2016

A group of investigative journalists has begun to lay bare information contained in 11 million documents from the archives of the Panamanian company Mossack Fonseca. The company specializes in tax havens, i.e., “laundering” money. A corner of the veil hiding world finances has been lifted.

There have been other revelations – in 2013, 2014, and 2015, but the Panama leak is the biggest ever. Hundreds of newspapers revealed the information at the same time, naming details of financial and industrial companies, and political parties that used the services of Mossack Fonseca to create tax shelters.

For example, some people close to the heads of the French government were good Panamanian clients, as were some very close to Putin in Russia, Poroshenko in the Ukraine, Assad of Syria, Ben Nayef of Saudi Arabia or the king of Morocco.

Others using the services of Mossack Fonseca were stars, like the footballer Lionel Messi; or the leaders of the big European political parties. They all swear they have nothing to hide!

Big banks were also named in the documents, like UBS and Credit Suisse, HSBC and the Societé General (a French bank), which since 1977, has created 979 offshore companies using Mossack Fonseca.

Without a doubt Mossack Fonseca has a worldwide reputation for creating tax havens. As one law professor said to the investigating journalists, “In Panama, in the matter of money laundering, they do everything, they wash it, rinse it, dry it.”

And this is just one company in one fiscal paradise. And the biggest names in the capitalist world don’t appear. They don’t need to use such money laundering services, which are only a small part of the reality of fiscal evasion. Avoiding taxes is a national sport for the bourgeoisie, no matter what country, no matter whether large or small. But the wealthiest and most powerful have ways to avoid the spotlight, even in cases where they have made off with massive amounts of money.

The states and the big fortunes are playing like the cat with the mouse. Of course the states would like to get part of the taxes that currently escape their laws. But at the same time, they must pamper their billionaires.

But even more, they do not know what to do in the face of the deep crisis of their economic system, that allows speculation to flourish. What they know is that tax havens are an essential part of the machinery of tax avoidance for financial speculation.