06 Nov 2017
A new leaked trove of legal documents from offshore law firm Appleby has revealed the financial arrangements and corporate secrets of the rich and powerful.
The revelations were coordinated by the International Consortium of Investigative Journalists (ICIJ), and shared with various media, including German newspaper Suddeutsche Zeitung, which sourced the documents.
Dubbed the Paradise Papers, the revelations highlight how politicians, multinationals and the wealthy use complex offshore vehicles for tax purposes and also secrecy.
Exposed are the arrangements of the Queen Elizabeth II’s private estate which holds investments in businesses such as offshore chain Threshers and retailers BrightHouse.
The latter has been accused of ‘hard selling’ to poor and vulnerable people, and last month was forced to pay almost £15m in compensation to customers.
There is nothing illegal in the investments, “but questions may be asked about whether the monarch should be investing offshore,” said media outlets.
Tory donor Lord Michael Ashcroft also features in the revelations, with a special focus on management of his offshore investments and suggestions that he made decisions which could be challenged by UK tax collector HMRC.
Lord Ashcroft, who has funded the Tory party with millions, also served as its deputy chairman.
He did not respond immediately when asked to comment.
Also revealed are the political ties and financial dealings of corporate Russia and America, including the inner circles of US President Donald Trump and Russian President Vladimir Putin.
According to the ICIJ, US Commerce Secretary Wilbur Ross has benefited from investments linked to Russian President Vladimir Putin’s son-in-law Kirill Shamalov, and Gennady Timchenko, an oligarch sanctioned by the United States Treasury Department.
Stephen Bronfman, a key aide of Canadian Prime Minister Justin Trudeau, also appears in the Paradise Papers regarding his links to offshore schemes that reportedly may have cost the tax payer millions.
Lawyers for Bronfman, who is chief fundraiser for Mr Trudeau’s Liberal Party, maintain his dealings were legal.
The ICIJ, which brought about the Panama Papers with other media outlets last year, is expected to reveal more details in this week.
In addition to secret ties, the Paradise Papers highlight the tax arrangements pertaining to assets such as jets and yachts.
Appleby, which made reference to the leaks ahead of their publication, recently said that it is “satisfied that there is no evidence of any wrongdoing, either on the part of ourselves or our clients.”
Jurisdictions such as Bermuda, the Caymen Islands and Isle of Man feature in the revelations.
The Isle of Man recently explained to journalists that it is being accused of running a tax avoidance scheme.
The jurisdiction has a regime in place where business jets can be imported to the European Union through the Isle of Man and obtain a 100% refund if the aircraft is purely for business purposes.
However, a government spokesman denied that the scheme was illegal, saying even the United Kingdom has a similar structure in place.
Chief Minister Howard Quayle MHK said that, in light of the claims made by the ICIJ, his government had asked the UK’s Treasury to look at all elements involved in the process of the importation of business jets via the Isle of Man into the EU.
– Irene Madongo
You can claim CPD minutes for reading this article, by signing up to our CPD WalletFREE CPD Wallet