The Paradise Papers

November 17, 2017 OPINION/NEWS

Marco Verch photo

 

By

Ricardo Swire

 

Two years ago a corporate bombshell was dropped internationally and exploded as the “Panama Papers.” The financial expose featured systems of offshore criminality and corruption, responsible for ending Iceland and Pakistan’s most senior politicians’ careers. In 2017 the “Paradise Papers” have resonated like a secondary detonation. On Sunday November 5, 2017 the collection of 13.4 million private investment files that include 7 million loan agreements, or 1.4 Terabytes of information, were made public.

The confidential information leaked to Suddeutsche Zeitung in Munich, Germany’s biggest daily newspaper. Documents revealed how financial vehicles are used to hide income, from place of origin taxation, in nineteen secret jurisdictions. Government Corporate registries in Antigua & Barbuda, Aruba, the Bahamas, Barbados, Bermuda, Cayman Islands, Cook Islands, Dominica, Grenada, Labuan, Lebanon, Malta, the Marshall Islands, St Kitts & Nevis, St Lucia, St Vincent & the Grenadines, Samoa, Trinidad & Tobago and Vanuatu, provide creative methods to avoid taxes via artificial structures.

The Paradise Papers originate from offshore law firm Appleby and its journals, plus files from corporate services providers Estera and Asiaciti Trust. Leaked documents contain more than 120,000 names of individuals and businesses with US$20 trillion collective value. The information links large financial investments made by Kremlin controlled VTB Bank and Gazprom to Facebook and Twitter, two deals consummated via a Russian technology aristocrat’s partnership with the American president’s son-in-law and senior White House Advisor.

From December 2005 Gazprom Investholding OOO in Moscow channelled cash to Kanton Services Ltd, a company registered in Road Town, Tortola, British Virgin Islands (BVI). In 2009 Gazprom paid US$920 million as part of a Kanton Service Ltd merger. In 2011 Kanton Services Ltd became major shareholder in DST USA II, the same year VTB Bank making a US$191 million investment in Twitter. VTB Bank is closely associated with Russia’s Intelligence Service the FSB. In 2012 the US Securities & Exchange Commission calculated DST USA II owned fifty million Facebook shares.

Concurrently Gazprom Investholding OOO sponsored DST Global. The offshore management company funded the corporate entity that controlled the Facebook US$1 billion share value. By 2014 both US Companies’ stakes were sold, as Washington applied sanctions on Russia. DST USA II’s ownership was transferred to “Usmanoc,” an invisible Russian middleman. His company sold the US$1 billion worth of Facebook shares, for an inflated profit, during a floating stock market period. The Russian technology titan is on record spending US$7 billion across thirty online businesses that include Airbnb, Spotify and Chinese retailers Alibaba and JD.com.

 

 

 

 

Ricardo Swire - Tuck Magazine

Ricardo Swire

Ricardo Swire is the Principal Consultant at R-L-H Security Consultants & Business Support Services and writes on a number of important issues.

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