Letter from Paradise: risks and reputations in the offshore world
At 18:00 GMT on Sunday 5 November 2017, I, like many others living in offshore financial centres (OFCs), was poised to review the publication of the “Paradise Papers”, which the International Consortium of Investigative Journalists (ICIJ) had promised would include startling revelations about the use of so-called “tax havens” by wealthy individuals and corporations, following a data breach at leading offshore law firm, Appleby.
“Is that it?” was the initial reaction.
There were several examples of famous persons and corporations using offshore trusts and corporations for entirely legal – and well-known - tax mitigation purposes (the morality of which is open to debate), but no evidence of anyone doing anything illegal. Amongst all the voyeurism, it was overlooked that the “Paradise Papers” themselves were stolen property, much of it private and legally privileged material pertaining to individuals. Nor did the press seem to recognise the irony that, whilst castigating OFCs for their supposed “secrecy”, they were content to receive and publish stolen materials from a secret source.
The pejorative term “tax haven” - which implies lax regulation and lack of transparency in addition to low or no income or corporation taxes - is not one that is accepted by any of the leading OFCs: Bermuda, the Cayman Islands, the British Virgin Islands, Jersey and Guernsey, the jurisdictions on which this article focusses.