Given my years covering China, I’ve been particularly interested in the fact that three of China’s top seven leaders have family members with accounts at this one law firm in Panama. It’s sort of astonishing in China: You get on the Politburo, and your family members magically become billionaires! One of those leaders tied to the Panama Papers is President Xi Jinping, who has used an anti-corruption campaign to oust his rivals and consolidate his power — even though his own family has amassed many hundreds of millions of dollars in dubious wealth. There are mutterings against Xi among Chinese elites (although he is still popular on the Chinese streets, largely because of the anti-corruption campaign), and it will be interesting to see whether his rivals try to use this scandal to undermine him.
Panama Papers: Why Aren’t There More American Names?
the United States is widely recognized as a leading source of offshore money: during the Union Bank of Switzerland tax-evasion scandal, it emerged that, at that bank alone, U.S. clients had almost twenty thousand Swiss-based accounts. In the hedge-fund industry, it is considered perfectly normal and entirely legitimate to domicile funds in tax havens like Grand Cayman or the British Virgin Islands.
.. of the roughly fourteen thousand intermediaries—banks, law firms, company-incorporation firms, and other middlemen—with which Mossack Fonseca worked over the years in order to set up companies, foundations, and trusts for its customers, six hundred and seventeen were based in the United States.
.. the United States isn’t among the ten countries for which Mossack Fonseca created shell companies. (Hong Kong, Switzerland, and the United Kingdom held the first three places)
.. Perhaps it deliberately avoided having a large presence in the United States, so as not to attract the attention of U.S. authorities. Or perhaps there was too much competition. An article published in The Economist in 2012 pointed out that the business of setting up shell companies in tax havens is competitive and includes a number of well-established firms
.. But, in 2010, the United States and Panama signed a trade-promotion agreement that, among other things, obliged Panama to provide to the U.S. authorities, on request, “information regarding the ownership of companies, partnerships, trusts, foundations, and other persons ..