Corruption is a Leaky Boat

By Nicholas Goroff

Conspiracy by nature requires silence and discretion on the parts of those involved. Whether it be an effort to topple a government, defraud the public or mask criminal endeavors, the necessity for secrecy is paramount to most any shady dealing. Whereas in the past many a collusion between powerful individuals and forces to carry out some scheme, either for the purposes of some strategic political gain, or otherwise simply a means by which to profit dishonestly beneath a code of silence were protected both by the silence of the parties involved and a plausible deniability rooted in the often incomplete evidence suggesting such. Yet it would seem our modern eras of global communication and whistleblower leaks have blown down the doors of many a dirty deed and criminal plot and are doing so at increasing rates.

The most recent instance of the new, more open information age we live in comes to us now in the form of what are being called ‘The Panama Papers.’ This leak of 11.5 million documents outlining questionable banking practices as well as dishonest dealings by many of the global elite, has many within the whistleblower and transparency scenes stunned over both the sheer size and scope of the leaks –the largest in history– as well as in regards to much of what they reveal about some of the world’s most powerful people, governments and institutions.  Exposing a series of offshore financial institutions, shell companies, tax havens and in even suspected fronts for money laundering operations, the Panama Papers illustrate a picture in which heads of state, financial and political elites, their families and in some cases criminal organizations and brutal despots hide millions in assets, often gained through corruption of government contracting, by utilizing the offshore networks and bogus holding companies.

At the center of many of these dodgy transactions is one particularly low profile key player. Based out of Panama, the small law firm known as Mossack Fonseca has been found through these leaks, to have played a central role in what authorities in multiple countries are regarding as a criminal web of shell corporations, used to aid everyone from Central American drug lords to North Korea in the sheltering and hiding of money. While corruption and shady dealings in the international finance world is nothing new or revolutionary unto itself, it is through these leaked communications that the public is for the first time offered the chance to analyze and consider the true nature to such in such a comprehensive and indisputable manner.

With Wikileaks presently (ostensibly) debating whether to release the entirety of the 11.5 million documents at once for immediate public consumption, the fallout from the emails presently available for review has been substantial. As of Tuesday April, 5th the Icelandic Prime Minister Sigmundur David Gunnlaugsson stepped down following revelations that he had attempted to hide millions in offshore tax shelters. His decision came in the midst of massive protests in which it is estimated that nearly 10% of the nations 330,000 inhabitants participated, spurned by public outrage over the allegations.

Throughout the western world, few nations have taken action against corporate or “white collar” crime as aggressively as Iceland, who since the 2008 financial crisis have jailed 26 bankers and financial criminals. Despite further implications of Parliamentarian participation in the financial frauds carried out by Mossack Fonesca, as well as continued political unrest within Iceland over Gunnlaugsson’s retaining of leadership within the Progressive Party in spite of his implication by the Panama Papers, Iceland’s President has thus far declined to dissolve Parliament amidst increasing calls for such.

However the reach and scope of these leaks extends well beyond Iceland, with everyone from English PM David Cameron to Russian President Vladimir Putin finding themselves also implicated. With the range of networks extending to every continent, the intricacies of not only who was seeking to hide or launder money, but who were brokering such deals and where they were located illustrates a particularly fascinating connection to Hong Kong as China’s economy continues to embrace market capitalism.

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Though still only released in part, the reach of what has been thus far an uncovering of a pervasive habit on the part of the world’s elites to stash cash in tax havens which increasingly appear to serve also as launderers for criminal organizations, such as the Mexican Guadalajara cartel, has even tapped into the hotly contested Democratic primary race between Bernie Sanders and Hillary Clinton. Though Clinton has not been named in the leaks to date, the former Secretary of State has already begun experiencing a social media trouncing as news of her efforts to push through a free trade deal with Panama, which is widely thought to have facilitated the growth of such firms as Mossack, are fueling the fires of populist uproar over what are increasingly recognized as double standards in respect to taxation and legal obligation.

Despite the notions of the actions of political and economic elites being themselves the root causes of economic stratification and even at times the central causes for economic suffering and strife throughout the world all relatively “common knowledge,” it is here in these leaks and the stories which are being written further as they are examined, which paint the most compelling picture of such, laid out in stark relief against the more common and petty excuses offered. As journalists and publications form left to right continue to bite into and investigate many of the conclusions drawn from these documents, the squabbling over whether such is a greater indictment of political elites or unfettered financial markets has already begun. Regardless though of one’s political persuasion, it is already being seen that the exposure of such realities serves as potent fuel for what is an already teeming populist outrage.

To the mind of your author, what is yet to be exposed and discovered by virtue of these leaks themselves is almost less interesting, if only slightly, than what public reaction might be when the underlying meaning to them is then commonly known. Whether such should result in what many have felt is a long overdue public rejection of the established elites due to their routine bad actions, or merely the typical disinterested shrug which follows the latest unfortunate story on the evening news has yet to be seen. However regardless of such, these Panama Papers have served as a demonstration that the age in which the dirty dealings of the powerful and corrupt could occur securely in secret is, if it has not already, rapidly drawing to a close.