Money in Politics
by Victor Cherubim
( April 11, 2016, London, Sri Lanka Guardian) There is the saying: “one rule for the rich, one rule for the poor”. This is nothing new and that is how the world works.
Piecing together news leads from mountains of information data is no doubt an unenviable task. But who said it cannot be done. If there is something for someone, everything is possible. The Panama law firm, Mossack Fonseca has by using the simple, but powerful and more subtly precise software produced by Nuix, together with the ingenuity of the Washington based International Consortium of Investigative Journalist (ICIJ) opened “a can of worms” recently. It has caused ripples worldwide.
Scanned documents, many decades old have cross referenced private clients and their records across continents and across documents, to expose how the rich and the famous, the world’s wealthy and the powerful, the “great and the good” as they say, and brought them to heel.
Panama Papers
The Panama Papers have revealed many and have implicated not only politicians. Critics say offshore havens supply global elite, a means of tax evasion. While its defenders say that it helps to provide “the plumbing of a globalised economy that has dragged millions out of poverty.”
Are these two positions contradictory? Are they both true?
Let us imagine for a moment that tax havens have served as shelters to buy anonymity literally “off the shelf”. Whether it is the Cayman Islands Bank accounts, or Liberia as a source of “bearer shares” or British Virgin Island in the Caribbean, or for that matter other jurisdictions least known of all, in the United States of America, in the State of Delaware, or in the State of Nevada, all these so called “jurisdictions” have one thing in common. There is “iron-clad” anonymity. These places ensure that profits would not be easily traced. This enabled funds to grow more quickly as more money could be reinvested each year. The accusation: Who is the fool who invests in one jurisdiction?
But secrecy comes with a price tag. Clients whether they be politicians like the Prime Minister of Iceland, or Vijaya Mallaya, the collapsed Kingfisher magnate, or the Medellin Cartel’s cocaine suitcases of drug money, or even ordinary rich politicians (names not supplied) were able to deposit their hard earned robberies, with no questions asked. Clients need to be only sophisticated investors and be able to put in $100,000, into these funds/accounts, although this minimum requirement was often waived.
For many unscrupulous investors the world over the “idea of roll over” significant quantities of tax free income was not tax evasion. It was the “thing to do”. The Panama Papers opened files of hundreds of wealthy from Briton and all over the world including even Russian, China and America, to shield assets from their estranged wives.
Need I say, when the world for good or bad criminalises nations, these nations are not sitting and waiting for sanctions to go away. Sanctions busting accounts help to spin complex off and on shore web accounts to mask billions of dollars. Further offshore tax havens are mostly controlled using “bearer shares” which do not carry the name of the owner and are similar to Bank Notes in that they belong to the person physically holding or bearing the Certificate literally in their hands. Bearer shares can easily be used to hide ownership and evade tax and were banned only in 2015 in the UK.
So is there anything wrong? The naivety is not on the people bearing “Bearer Notes”. Blame the tax havens, some say. They encourage corruption?
On the other side of the coin
Deterring graft, ending impunity for the corrupt is one thing. Who is now going to patch up, who is going to take control of privacy for ordinary law abiding individuals? There is one thing to tolerate transparency; there is another serious issue about personal privacy for the individual.
Disclosure of Information by Apple
Information Download has been in the news recently. After the San Bernardino killing spree the Law Enforcement Agencies in the U.S. have demanded that Apple provide assistance in “unlocking” an iPhone. Weeks of agonising public debate have gone on over US authorities compelling Apple to help break into an encrypted iPhone.
Technology comes to rescue privacy
“What’s App” a popular Facebook owned mobile application, with one billion worldwide users, has made an announcement that it has compiled a technological development to protect private communication with full end-to-end encryption. This means that when you send a message, the only person you send that message can access and read it. No one, not cyber criminals, or hackers, nor oppressive regimes, not even the manufacturers, can see inside that message. No one has the keys to unlock data. They say “warrant proof” space which until now was available for criminals has been countered.
Sensitive records, possibly even the “Panama Papers” have been improperly accessed or stolen without “private consent”. Whilst this is happening, US Congress is expected to consider legislation which could require technology firms to retain “keys” that could retrieve data in a criminal investigation, with perhaps a Court Order.
Short-changing Money or short-changing privacy, that is the issue at stake. It’s good to have hidden wealth exposed. It’s always been one rule for the rich, and it will continue to be one rule for the poor.
