Last week, the International Consortium of Investigative Journalists released the leaked financial document cache known as name of " Pandora " Papers ", consisting of over 11.9 million confidential files from fourteen offshore service companies located in many countries. The release of these files adds to the existing treasure trove of similar sensational material revealed in previous leaks, including the Panama " Papers , published in April 2016 and the Paradise " Papers , published in November 2017, which detailed trillions of dollars in funds held “offshore” by taxpayers around the world. More than in previous leaks, the United States plays a prominent role in the Pandora Papers, not only as a source of the immense wealth held abroad or of the professional expertise facilitating such arrangements, but asas a full-fledged offshore destination.
Among the most spectacular revelations is the revelation that King Abdullah II of Jordan used shell companies based in the British Virgin Islands to buy, among other properties, a 23million California mansion of dollars. The King's secret purchase of high-end US real estate through BVI companies, juxtaposed with the US role as Jordan's largest bilateral aid provider ( representing more than $ 1.5 billion in 2020 ), dramatically underscores the tension inherent in US jurisdictions serving as tax havens.
The emphasis on US jurisdictions in the Pandora Papers also contrasts with American rhetoric, if not its actions. While theUS State Department spokesman Ned Price said "the US government is actively focused on strengthening financial transparency" and "is to push for full implementation of existing standards. and, where appropriate, to more stringent measures "aimed at the pulgation of beneficiaries shell companies and other means of concealing illicit funds, the pandora papers reveal a more complex reality. for example, exposed numerous trusts linked to foreign interests in south dakota (81), florida (37), delaware (35), texas (24) nevada (14). based on papers, investigative journalists alleged that "nearly 30 of the 206 US-based trusts with combined assets worth over $ 1 billion are linked to foreign individuals and companies accused of wrongdoing . The Pandora Papers have discovered, betweenother US-based arrangements, South Dakota Trusts established by both the former Vice President of the Dominican Republic and the current President of Ecuador, each of which has transferred assets to the States -United following legislation in other jurisdictions cracking down on offshore assets.
As "I wrote previously , while the Internal Tax Administration and the Department of Justice have devoted significant resources to combating tax evasion in the United States, through programs such as the IRS Offshore Voluntary Disclosure Program and the DOJ Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks, efforts to restricting the use of US jurisdictions as tax havens for the benefit of non-US taxpayers have not been pursued with the same fervor. Indeed, Tax Justithis Network 2020 Financial Secrecy Index ranks the United States second top-secret jurisdictions , against 132 others., noting that "after initially agreeing to a multilateral information exchange, the [United States] quickly did an about-face and has since refused to provide information to most other jurisdictions. sdictions - although he continues to insist, with threats, on receiving information from others.
This photographic illustration shows the logo of Pandora Papers, in Lavau-sur-Loire, in the west of France, ... on October 4, 2021. - Russia on October 4 rejected the revelations AFP via Images fbs -ad>
Specifically, the United States passed the Foreign Account Tax Compliance Act ("FATCA") in 2010, requiring non-US financial institutions to share information about their US customers and, in order to encourage compliance by foreign governments, offered reciprocal exchange of information regarding foreign customers of US banks through bilateral intergovernmental agreements ("AGR"). However, a real exchange of information within the framework of FATCA has been hampered by the limited nature of IGAs, of which " only some even require a reciprocal exchange of information , and for those who include such an exchange, grants " the United States the rights to receive much more detailed information than those provided to other jurisdictions. Deficiencies in IGAs are exacerbated by loopholes in US banking laws, for example absence "of a uniform requirement of —which, together, left the United States an even more alternative attractive to foreigners seeking refuge from a growing global transparency regime. Indeed, in September, the European Parliament published a resolution denouncing "the lack of reciprocity within the framework of FATCA" and "observe [ing] that the United States becomes an important catalyst of financial secrecy for non-American citizens.
In addition, the United States remains one "of the few developed countries not to have adopted the multilateral Common " Reporting Standard for the automatic exchange of information on financial accounts, in place of the Organization for Economic Co-operation and Development ("OECD") cites the ambitious recognition of United States of "the need for the United States to achieve equivalent levels of automatic reciprocal information exchange" and "political commitment to continue to adopt regulations and ... exchange. ' "
Many hope that the adoption of the Corporate " Transparency Act , enacted on January 1, 2021, will ultimately push the United States towards greater openness regarding structures based in the United States, including it required the declaration of beneficial ownership of a "corporation, limited liability company or other similar entity". However, whether this legislation will be effective in dealing with the type of arrangements in US jurisdictions a "amendment to the Bank Secrecy Act , called the Enablers Act., To require service providers, such as lawyers, investment advisers and accountants, to carry outCarry out anti-money laundering due diligence on potential clients.
Much like the previous leaks, the Pandora Papers exposed the myriads of ways in which a porous international system of tax and banking law enforcement allowed vast wealth to be displaced abroad and free from virtually any oversight by regulators. But perhaps more than ever, this new data dump shows how US jurisdictions have become a preferred repository for such wealth.
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