Offshore data exposes financial secrets of effluent personalities

Several countries' ramped up drive against the black money menace has forced wealthy elites, including from India, to adopt a new method to ring fence their wealth, revealed the 'Pandora Papers', the latest leak of offshore files. The records include an unprecedented amount of information on so-called beneficial owners of entities registered in the British Virgin Islands, Seychelles, Hong Kong, Baleez, Panama, South Dakota and other secrecy jurisdictions.

They also contain information about the shareholders, directors and officers. The interesting thing is Pandora Papers investigation also reveals how banks and law firms work closely with offshore service providers to design complex corporate structures. The influencers had paid millions to hide Trillions and the files show that providers don’t always know their customers, despite their legal obligation to take care not to do business with people who engage in questionable dealings.

About 30,000 private foreign trusts had been set up across the globe in not just tax friendly jurisdictions, where the laws are comparatively lenient, but also in those jurisdictions such as US, Singapore, which have very rigorous tax laws. Many jurisdictions continue to evade law enforcement agencies that chase the secret money trails of tax dodgers and criminals. Due to all the obvious regulatory and enforcement gaps, and to the seeming lack of political will to address those gaps actively and practically, there are some encouraging signs suggesting governments around the world are being forced to act.

The investigation also reports on how U.S. trust providers have taken advantage of some states’ laws that promote secrecy and help wealthy overseas clients hide wealth to avoid taxes in their home countries. However, certain legal experts say that, being named as beneficial owner of a trust is not an offence as it's not a violation under any Indian laws. So, agencies would see whether the investment done was through a legal route and if disclosure has been made.